Effects of education on cognition at older ages: evidence from China's Great Famine.

This paper explores whether educational attainment has a cognitive reserve capacity in elder life. Using pilot data from the China Health and Retirement Longitudinal Study (CHARLS), we examined the impact of education on cognitive abilities at old ages. OLS results showed that respondents who completed primary school obtained 18.2 percent higher scores on cognitive tests than those who did not. We then constructed an instrumental variable (IV) by leveraging China's Great Famine of 1959-1961 as a natural experiment to estimate the causal effect of education on cognition. Two-stage least squares (2SLS) results provided sound evidence that completing primary school significantly increases cognition scores, especially in episode memory, by almost 20 percent on average. Moreover, Regression Discontinuity (RD) analysis provides further evidence for the causal interpretation, and shows that the effects are different for the different measures of cognition we explored. Our results also show that the Great Famine can result in long-term health consequences through the pathway of losing educational opportunities other than through the pathway of nutrition deprivation.