“…In the literature on returns to education, the method of instrumental variables (IV) has been used as a standard solution to the problem of causal inference. It has become common to employ various sources of exogenous variations such as compulsory schooling legislation, tuition costs and accessibility of schools to draw a causal impact of schooling on labour market earnings (Card, 2001), health and health behaviour (Brunello et al, 2015;Spasojević, 2010), mortality (Clark and Royer, 2013;Lleras-Muney, 2005), fertility (McCrary and Royer, 2011) and crime (Lochner and Moretti, 2004;Machin et al, 2011). Policy interventions and reforms of the educational system serve as natural experiments since they exogenously impact the educational attainment of the treated population.…”