In a recent, and widely cited, paper, Ashenfelter and Krueger (1994) use a new sample of identical
twins to investigate the contribution of genetic ability to the observed cross-sectional return to schooling.
This paper re-examines Ashenfelter and Krueger’s estimates using three additional years of the same twins
survey. I find that the return to schooling among identical twins is about 10 percent per year of schooling
completed. Most importantly, unlike the results reported in Ashenfelter and Krueger, I find that the within-
twin regression estimate of the effect of schooling on the log wage is smaller than the cross-sectional
estimate, implying a small upward bias in the cross-sectional estimate. Ashenfelter and Krueger’s
measurement error corrected estimates are insignificantly different from those presented here, however.
Finally, there is evidence of an important individual-specific component to the measurement error in
schooling reports.