Abstract not found

Mincer wage equations focus on the earnings premium associated with additional schooling for a cross section of individuals of different ages but generally fail to account for changes in education quality over time. More fundamentally, school attainment is an inadequate proxy of individual skills, when both family inputs and ability affect cognitive skills. We combine quality-adjusted measures of schooling and international literacy test information to estimate skill gradients for 13 countries. The premiums to quality-adjusted education are considerably higher than the traditional Mincer estimate for most countries, but this bias is more than offset by consideration of other factors affecting skills and earnings.

This paper measures the role of quality-adjusted years of schooling in accounting for cross-country output per worker differences. While data on years of schooling are readily available, data on education quality are not. I use the returns to schooling of foreign-educated immigrants in the United States to measure the education quality of their birth country. Immigrants from developed countries earn higher returns than do immigrants from developing countries. I show how to incorporate this measure of education quality into an otherwise standard development accounting exercise. The main result is that cross-country differences in education quality are roughly as important as cross-country differences in years of schooling in accounting for output per worker differences, raising the total contribution of education from 10 % to 20% of output per worker differences.

Abstract Dropping out of school has recently become a major issue of policy concern in Italy. A series of reforms of secondary school objectives, programmes and organizational design have been proposed to adapt the public school system to evolutions in the labour market and to increase overall educational attainment. The aim of our work is to gain some understanding of the causes of dropping out of school and, more generally, of the factors that induce parents to review their choices about their child's schooling careers. To this end we make use of data from the "school dropout survey" undertaken in Salerno Province by the Centre for Labour Economics and Economic Policy (CELPE). The survey collected a range of information on adolescent young people and their families over the period 2004-06. The paper proposes a model of sequential decision making by parents where the decision can be reviewed in the light of new information emerging about the ability and opportunities of the child in profiting from education relative to her outside (in the unskilled market). The model allows interpretation of such dropout and return behaviour and emphasises both the role of economic capacity (opportunity costs) as well as cultural capacity (ability to disentangle signals about future opportunities) for equilibrium decision making. Analysis of the data confirms the role of both economic and cultural capacity of the family of origin in shaping observed choices about drop-out and return to school by individuals in our sample. Interestingly we find that whilst poor performance at, and low attachment to, school -measured by repetition of the school year through end of year failure and attendance records -is a key determinant of initial dropping out, the former is also strongly positively associated with a subsequent return to education. An important implication of this finding is that "initial" dropping out behaviour is often determined by a mismatch between school and student rather than poor performance per se. The answer to the question in the title of this paper, interpreted in its normative sense, therefore is no: the process of allocation of talents to school tracks is subject to many trial errors and revisions by families and many of those who live school return to it.

Although high drop out rates are common in youth job-training programmes (YJTP), little attention has been devoted to understand this phenomenon. This paper explains why trainees do not complete YJTPs. Particularly, we analyze the case of Projoven-Peru. We estimate individuals ’ drop out likelihood using a probit model with sample selection as the withdrawal decision is only observed for those trainees who are placed in internships. We find that experiencing training courses prior to Projoven, having a formal contract during the internship and the effectiveness of the training, measured as the share of trainees working six months after training per training provider, decrease the likelihood to drop out of Projoven internship. We distinguish two exit routes: withdrawal from training to a job and withdrawal from training to unemployment-inactivity. We find evidence that being a male and increments in the household family income augment the likelihood to drop out of training to a job; whereas high unemployment rate reduces the chance to drop out of training to unemployment-inactivity.

Micro-evidence from primary schools and public

Abstract not found

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We develop a theory of educational quality to study how quality could account for schooling decisions regarding higher education (secondary and above), and how the distribution of educational attainment and educational quality di¤er with the level of development. In a general equilibrium closed economy, higher education requires an extra investment of private resources, whereas primary education does not. The theory states that human capital accumulation depends on quality through two channels. The extensive channel refers to access to higher education. Even with perfect capital markets, relatively low quality could discourage opportunities to pursue education beyond primary school, since low quality decreases the returns from higher education. As a result, agents could get stuck at primary levels, and the economy ends up being poor. The intensive channel establishes that once individuals decide to participate in higher schooling, the higher the quality of educational system, the larger the investment made by each agent. Using cross-country data, empirical evidence shows that the proposed channels seem to be quantitatively important. Furthermore, the quality of education proves to be an important determinant of economic growth, especially when the quality of education is relatively high.

We develop a theory of human capital investment to study the channels through which students react to school quality when deciding on investments in secondary education and above, and to study how educational quality affects economic growth. In a dynamic general equilibrium closed economy, primary education is mandatory but there is an opportunity to continue on in education, which is a private choice. High-quality education increases the returns to schooling, and hence the incentives to accumulate human capital. This is caused by two main effects: higher quality makes higher education accessible to more people (extensive channel), and once individuals decide to participate in higher education, higher quality increases the volume of investment made per individual (intensive channel). Furthermore, educational quality plays a central role in explaining the composition of human capital and the long-run level of income. Cross-country data evidence shows that the proposed channels are quantitatively important and that the effect of the quality and quantity of education on growth depends on the stage of development.