Education reforms and adult skills: Evidence from Estonia

By Kieran Byrne and Alexander Plekhanov

This paper investigates the impact of education reforms in Estonia on adult skills, using the PIAAC surveys conducted by the OECD. Estonia implemented comprehensive education reforms in the early 1990s throughout Estonian-speaking schools while in Russian-speaking schools less comprehensive reforms were implemented later. A large minority of Estonia’s population at the time was enrolled in Russian-speaking schools. This provides a unique opportunity to measure the impact of education reforms on literacy, numeracy and problem-solving skills among adults by comparing improvements in PIAAC performance among Estonian and Russian speakers. Difference-in-difference estimations suggest that the reforms led to an improvement of around 15 per cent of a standard deviation in terms of adult skills. This translates into a wage (productivity) premium of around 6 per cent.