Confluence Model or Resource Dilution Hypothesis?

Studies on family background often explain the negative effect of sibship size on educational attainment by one of two theories: the Confluence Model (CM) or the Resource Dilution Hypothesis (RDH). However, as both theories – for substantively different reasons – predict that sibship size should have a negative effect on educational attainment most studies cannot distinguish empirically between the CM and the RDH. In this paper, I use the different theoretical predictions in the CM and the RDH on the role of cognitive ability as a partial or complete mediator of the sibship size effect to identify a unique RDH effect on educational attainment. Using sibling data from the Wisconsin Longitudinal Study (WLS) and a random effect Instrumental Variable model, I find that in addition to having a negative effect on cognitive ability, sibship size also has a strong negative effect on educational attainment which is uniquely explained by the RDH.