7 - Private Returns on Education in Ghana: Estimating the Effects of Education on Employability in Ghana
Corresponding Author(s) : Prince Asafu-Adjaye
African Sociological Review,
Vol. 16 No. 1 (2012): African Sociological Review
Abstract
The relevance of education for both individual and social development in Ghana and in many developing societies is generally acknowledged. Human capital theorists identify positive effects of education on labour market outcomes of individuals. It has been argued that education enhances the skills and knowledge of individuals for better employment, higher productivity and improved wages. This paper draws on the latest and most comprehensive survey data in Ghana, the fifth round of the Ghana Living Standards Survey (GLSS 5), to assess the effects of education on employability in Ghana. This paper argues that education has a positive effect on employability in Ghana. Analysis of the GLSS 5 data shows that in the Ghanaian labour market, individuals who have attained basic, secondary and tertiary education have higher probabilities of being employed than those with no education, ceteris paribus. However, the highest private returns on education, in terms of employability is tertiary education. Hence optimal post primary education investment in Ghana is one with a high possibility for tertiary education.
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- Agüero, A., 2009, education, Mobile Phone Use and Production Decisions: A rural Case Study in Peru (http://mobileactive.org/files/file_uploads/final-paper_aguero pdf ). 23 August, 2012
- Baah, A. Y., 2007, Organizing The informal economy: experiences and Lessons from Africa and Asia, Accra; Ghana Trades Union Congress/LO-FTF Council.
- Becker, G. S., 2008, “Human Capital. (http://www.econlib.org/library/EncHuman Capital.html). 18July, 2011
- Card, D., 1998, The Causal effect of education on earnings, Berkeley; Centre for Labour Economics, University of Califonia. Working Paper No. 2.
- DIAL., 2007, youth and labour markets in Africa: A critical review of literature. Pari; DIAL.
- Fasih, T., 2008, Linking education Policy to Labor Market Outcomes, Washington DC; The International Bank for Reconstruction and Development/The World Bank.
- Flores-Lagunes, A., and Light, A., 2009, interpreting Degree effects in the returns to education. Bonn; Institute for the Study of Labor (IZA), Discussion Paper No. 4169.
- Ghana Statistical Service, 2008, Ghana Living Standards Survey report of the fifth round, Accra; Ghana Statistical Service. Unpublished Report.
- Harmon, C., Oosterbeek, H., and Walker, I., 2000, The returns to education: A review of evidence, issues and Deficiencies in the Literature, London; Centre for the Economics of Education, London School of Economics and Political Science. Heckman, J. J., Lochner, L. J., and Todd, P. E., 2008, earnings functions and rates of ` return, Bonn; Institute for the Study of Labor (IZA), Discussion Paper No. 3310.
- Jajri, I., 2007, ‘Determinants of Total Factor Productivity Growth in Malaysia’, Journal of economic Cooperation, Vol 28 No. 3, pp. 41-58.
- Kuepie, M., Nordman, C. J., and Roubaud, F., 2006, education and Labour Market Outcomes in Sub-Saharan West Africa, Pari; DIAL.
- Lau, L. J., Jamison, D. T., Liu, S. C., and Steven, R., 1993, Education and Economic Growth: Some Cross-Sectional Evidence from Brazil. Journal of Development economics, Vol 41, Issue 1, pp., 45-70.
- Otoo, K. N., and Asafu-Adjaye, P., 2009, Vocational and Technical Training education in Ghana: Training Possibilities for food Vendors in Accra, Accra; Ghana Trades Union Congress and LO/FTF Council – Denmark, Unpublished Research Report.
- Otoo, K. N., and Asafu-Adjaye, P., 2011, Wages and Working Conditions of Media Workers in Ghana, Accra; Labour Research and Policy Institute, Research Paper 2011 (01).
- Patrinos, A. H., Ridao-Cano, C., and Sakellariou, C., 2006, estimating The returns to education: Accounging for Hetrogeniety in Ability. World Bank Policy Research Working Paper 4040 (http://www.econlib.org/library/Enc/HumanCapital.html), June 29 2011.
- Psacharopoulos, G., 2007, The effects of education on employment, Wages and Productivity: an european perspective. Thematic Review Seminar of the European Employment Strategy (pp. 1-37). European Expert Network on Economics of Education (http://pdf.mutuallearningemployment.net/pdf/thematic%2reviews%202007/TRSF_sept%2007/thematic_paper_psacharopoulos TRS%20F_EN.pdf ), 19 March 2012
- Riddell, C. W., & Song, X. (2011). The impact of education on Unemployment incidence and re-employment Success: evidence from the U.S. Labour Market, Bonn; Institute for the Study of Labor (IZA) Discussion Paper No. 5572.
- Schultz, P. T., 2003, evidence of returns to Schooling in Africa from Household Surveys: Monitoring and restructuring the Market of education, New Haven; Economic Growth Centre, Yale University, Centre Discussion Paper No. 875.
- Schultz, P. T., 2004, ‘Social Value of Research and Technical Skills: Does It Justify Investment in Higher Education for Development?’, JHEA/RESA Vol. 2, No. 1, pp. 92–134.
- Spence, M., 1973, ‘Job Market Signaling’, The Quarterly Journal of economics, Vol. 87, No 3, pp. 355-374.
- Tansel, A., and Bircan, F., 2010, Wage inequality and returns to education in Turkey: A Quantile regression Analysis, Bonn; Institute for the Study of Labor (IZA), Discussion Paper No. 5417.
- Wodaj, O. E., 2002, returns To Schooling in Non-farm Self-employment: The Case of Selected Urban Centres in ethiopia, Unpublished Thesis submitted to the School of Graduate Studies, Addis Ababa University - Ethiopia
References
Agüero, A., 2009, education, Mobile Phone Use and Production Decisions: A rural Case Study in Peru (http://mobileactive.org/files/file_uploads/final-paper_aguero pdf ). 23 August, 2012
Baah, A. Y., 2007, Organizing The informal economy: experiences and Lessons from Africa and Asia, Accra; Ghana Trades Union Congress/LO-FTF Council.
Becker, G. S., 2008, “Human Capital. (http://www.econlib.org/library/EncHuman Capital.html). 18July, 2011
Card, D., 1998, The Causal effect of education on earnings, Berkeley; Centre for Labour Economics, University of Califonia. Working Paper No. 2.
DIAL., 2007, youth and labour markets in Africa: A critical review of literature. Pari; DIAL.
Fasih, T., 2008, Linking education Policy to Labor Market Outcomes, Washington DC; The International Bank for Reconstruction and Development/The World Bank.
Flores-Lagunes, A., and Light, A., 2009, interpreting Degree effects in the returns to education. Bonn; Institute for the Study of Labor (IZA), Discussion Paper No. 4169.
Ghana Statistical Service, 2008, Ghana Living Standards Survey report of the fifth round, Accra; Ghana Statistical Service. Unpublished Report.
Harmon, C., Oosterbeek, H., and Walker, I., 2000, The returns to education: A review of evidence, issues and Deficiencies in the Literature, London; Centre for the Economics of Education, London School of Economics and Political Science. Heckman, J. J., Lochner, L. J., and Todd, P. E., 2008, earnings functions and rates of ` return, Bonn; Institute for the Study of Labor (IZA), Discussion Paper No. 3310.
Jajri, I., 2007, ‘Determinants of Total Factor Productivity Growth in Malaysia’, Journal of economic Cooperation, Vol 28 No. 3, pp. 41-58.
Kuepie, M., Nordman, C. J., and Roubaud, F., 2006, education and Labour Market Outcomes in Sub-Saharan West Africa, Pari; DIAL.
Lau, L. J., Jamison, D. T., Liu, S. C., and Steven, R., 1993, Education and Economic Growth: Some Cross-Sectional Evidence from Brazil. Journal of Development economics, Vol 41, Issue 1, pp., 45-70.
Otoo, K. N., and Asafu-Adjaye, P., 2009, Vocational and Technical Training education in Ghana: Training Possibilities for food Vendors in Accra, Accra; Ghana Trades Union Congress and LO/FTF Council – Denmark, Unpublished Research Report.
Otoo, K. N., and Asafu-Adjaye, P., 2011, Wages and Working Conditions of Media Workers in Ghana, Accra; Labour Research and Policy Institute, Research Paper 2011 (01).
Patrinos, A. H., Ridao-Cano, C., and Sakellariou, C., 2006, estimating The returns to education: Accounging for Hetrogeniety in Ability. World Bank Policy Research Working Paper 4040 (http://www.econlib.org/library/Enc/HumanCapital.html), June 29 2011.
Psacharopoulos, G., 2007, The effects of education on employment, Wages and Productivity: an european perspective. Thematic Review Seminar of the European Employment Strategy (pp. 1-37). European Expert Network on Economics of Education (http://pdf.mutuallearningemployment.net/pdf/thematic%2reviews%202007/TRSF_sept%2007/thematic_paper_psacharopoulos TRS%20F_EN.pdf ), 19 March 2012
Riddell, C. W., & Song, X. (2011). The impact of education on Unemployment incidence and re-employment Success: evidence from the U.S. Labour Market, Bonn; Institute for the Study of Labor (IZA) Discussion Paper No. 5572.
Schultz, P. T., 2003, evidence of returns to Schooling in Africa from Household Surveys: Monitoring and restructuring the Market of education, New Haven; Economic Growth Centre, Yale University, Centre Discussion Paper No. 875.
Schultz, P. T., 2004, ‘Social Value of Research and Technical Skills: Does It Justify Investment in Higher Education for Development?’, JHEA/RESA Vol. 2, No. 1, pp. 92–134.
Spence, M., 1973, ‘Job Market Signaling’, The Quarterly Journal of economics, Vol. 87, No 3, pp. 355-374.
Tansel, A., and Bircan, F., 2010, Wage inequality and returns to education in Turkey: A Quantile regression Analysis, Bonn; Institute for the Study of Labor (IZA), Discussion Paper No. 5417.
Wodaj, O. E., 2002, returns To Schooling in Non-farm Self-employment: The Case of Selected Urban Centres in ethiopia, Unpublished Thesis submitted to the School of Graduate Studies, Addis Ababa University - Ethiopia