Chapter 4. The Interplay of Reading, Spelling, and Math in Primary Education: A Panel VAR Analysis This chapter contributes to the literature by investigating the interplay between reading, spelling, and math skills with a panel VAR model. Panel VAR modeling, as proposed by Holtz-Eakin et al. (1988), is well-established in macroeconomic and financial research (e.g., Adarov, 2021; Antonakakis et al., 2017; Berdiev & Saunoris, 2016; Comunale, 2022; Forgione & Migliardo, 2022; Grossmann et al., 2014; Jawadi et al., 2016; Jouida, 2018; Ru¨ nstler, 2024), but rarely used in educational research. This is presumably due to limited data over time and across entities, and a focus on static outcomes rather than dynamic interactions in educational research. However, educational research can significantly benefit from panel VAR models. Education systems are influenced by and interact with various economic, social, and policy variables over time. Panel VAR models capture dynamic interactions by linking changes in one variable to changes in others over time and across units (e.g., students, schools, etc.). They can also be used to explore hypothetical scenarios, showing how changes in one variable are associated with changes in others. This can help policymakers and educators anticipate patterns in educational outcomes and better understand potential relationships before decisions are made. This chapter benefits from a unique and rich dataset that follows the skill development of a large number of students throughout their primary school period on a semi-annual basis. This enables us to analyze the development of several skills over time. The current literature investigates the interplay of skills in two ways: 1) the contemporaneous relationship between two skills (e.g., today’s reading skills relate to today’s math skills), and 2) the predictive role of one skill for another skill (e.g., today’s reading skill predict future’s math skills). Unlike 82
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