4 - Social Value of Research and Technical Skills: Does It Justify Investment in Higher Education for Development?
Journal of Higher Education in Africa,
Vol. 2 No. 1 (2004): Journal of Higher Education in Africa
Abstract
Evidence assembled from household surveys collected from 1985 and 1998 from Ghana, Côte d’Ivoire, Kenya, and South Africa indicates that higher wages compensate individuals in these African countries for enrolling in school. It is commonly believed that wage returns to schooling are highest at the primary levels and decrease thereafter at higher school levels, but the data from Africa summarized here indicate the opposite, with private wage returns being high- est at the secondary and higher education levels. There appear to be sufficient financial incentives today to motivate students to enroll in higher education, and any public subsidies should be allocated only to those students who come from poor families and whose parents are relatively least educated, relative to their generation. If students in higher education in Africa from upper-income families paid tuitions which were equal to half the public subsidies for their schooling, these revenues would finance fellowships for disadvantaged stu- dents and also provide the resources and incentives to expand higher education into those fields where trained manpower is scarcest today in Africa. They would thus create the conditions for greater self-governance of higher educa- tion while fostering a responsible separation from political power.
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- Albrecht, D., & Ziderman, A. (1991). Deferred cost recovery for higher education. Discussion Paper No. 137. Washington, DC: World Bank.
- Arends-Kuenning, M., & Amin, S. (2000). The effects of schooling incentive programs on household resource allocation in Bangladesh. Policy Research Division, Working Paper 133. New York: Population Council.
- Becker, G. S. (1964). Human capital. New York: Columbia University Press. Berthelmey, C., & Bourguignon, F. (1996). Growth and crisis in Côte d’Ivoire. Washington, DC: World Bank.
- Bhagwati, J., & Partington, M. (Eds.). (1976). Taxing the brain drain. Amsterdam: North Holland Publishing Company.
- Binswanger, H. P., & Rosenzweig, M. R. (Eds.) (1984). Contractual arrangements, employment and wages in rural labor markets in Asia. New Haven, CT: Yale University Press.
- Boissiere, M., Knight, J. B., & Sabot, R. H. (1985). Earnings, schooling, ability and cognitive skills. American Economic Review, 75, 1026-30.
- Burgess, R. S. L. (1997). Fiscal reform and extension of basic health and education. In C. Colclough (Ed.), Marketing education and health in developing countries. New York: Clarendon Press, Oxford University Press.
- Card, D. (1999). The causal effects of education on earnings. In O. Ashenfelter & D. Card (Eds.), Handbook of Labor Economics (Vol. 3). Amsterdam, North Holland Publishing Company.
- Card, D. (2001). Estimating the returns to schooling: Progress on some persistent problems. Econometrica, 69(5), 1127 1160.
- Card, D., & Lemieux, T. (2001). Can falling supply explain the rising return to college for younger men? Quarterly Journal of Economics, 116(2), 705-746.
- Chattopadhay, E., & Duflo, E. (2001). Women’s leadership and policy decisions: Evidence from a nationwide randomized experiment in India. MIT Discussion Paper. Cambridge, MA. Colclough, C. (1997). Marketing education and health in developing countries. New York: Clarendon Press, Oxford University Press.
- Denison, E. F. (1962). Sources of economic growth in the United States and the alternatives before us. Supp. Paper No. 13. New York: Committee for Economic Development.
- Duflo, E. (2001). Schooling and labor market consequences of school construction in Indonesia. American Economic Review, 91(4), 795-813.
- Easterly, W. (2001). The elusive quest for growth. Cambridge, MA: MIT Press. Fei, J. C., & Ranis, G. (1964). Development of the labor surplus economy: Theory and policy. Homewood, IL: Richard D. Irwin.
- Foster, A., & Rosenzweig, M. (1995). Learning by doing and learning from others: Human capital and technical change in agriculture, Journal of Political Economy, 103(6), 1176-1209.
- Harris, J., & Todaro, M. (1970). Migration, unemployment and development. American Economic Review, 60(1), 126-142. Hinchliffe, K. (1993). Neo-liberal prescription for education finance: Unfortunately necessary or inherently undesirable? International Journal of Educational Development, 13(2), 183-187.
- Jacoby, H. G., & Skoufias, E. (1997, July). Risk, financial markets, and human capital in a developing country. Review of Economic Studies, 64, 311-335.
- Jaffe, A., Trajtenberg, M., & Henderson, R. (1993). Geographic localization of knowledge spillovers as evidence by patent citation. Quarterly Journal of Economics, 108(3), 577-598.
- Jimenez, E. (1987). Pricing policies in social sectors: Cost recovery for education and health in developing countries. Baltimore, MD: Johns Hopkins University Press.
- Johnstone, D. (1992), International comparisons of student financial support. In M. Woodhall (Ed.), Higher Education, 23(4), 24-44.
- Jorgenson, D. W. (1995). Productivity. Vol. 1: Postwar U.S. economic growth. Cambridge, MA: MIT Press.
- Kim, S., & Lee, J-H. (2001). Demand for education and developmental state: Private tutoring in South Korea. Social Science Research Electronic Paper, Collection No. 268284. Available at http://papers.ssrn.com/paper/taf?abstract_id=268284.
- Kimalu, P. K., Nafala, N., Manda, D. K., Mwabu, G., & Mimeyi, M. S. (2001). Kenyan public education sector: Structure and performance. Paper prepared for the Kenyan Institute of Public Policy Research and Analysis, Nairobi.
- King, E. M. (1997). Who pays for education in Indonesia. In C. Colclough (Ed.), Marketizing education and health in developing countries (pp. 165-182). New York: Clarendon Press, Oxford University Press.
- Knight, J. B., & Sabot, R. H. (1981). The returns to education: Increasing with experience and decreasing in expansion. Oxford Bulletin of Economics and Statistics, 43(1), 51-71.
- Knight, J. B., & Sabot, R. H. (1990). Education, skills and inequality: The East Africa national experiment. New York: Oxford University Press.
- Kuznets, S. (1966). Modern economic growth: Rate, structure and spread. New Haven, CT: Yale University Press.
- Lewis, A. (1954, May). Economic development with unlimited supplies of labor. Manchester School of Economics and Social Sciences, 22, 139-191.
- Lucas, R. (1988). On the mechanics of economic developments. Journal of Monetary Economics, 22(1), 3-22.
- Maluccio, J. A. (1997). Essays on development: Labor markets in rural Philippines. Unpublished Ph.D. dissertation, Yale University, New Haven, CT. Mincer, J. (1974). Schooling, experience and earnings. New York: Columbia University Press.
- Moretti, E. (1998). Social returns to education and human capital externalities: Evidence from cities. Center for Labor Economics, Working Paper No. 9. Berkeley: University of California.
- Mwabu, G., & Schultz, T. P. (2000). Wage premia for the education and location of workers in South Africa, by gender and race. Economic Development and Cultural Change, 60(1), 126-142. 1998 Economic Growth Center, Discussion Paper No. 785.
- National Research Council. (1986). Population growth and economic development policy questions. Washington, DC: National Academy Press. National Research Council. (1993). Population dynamics of Kenya. Washington, DC: National Academy Press.
- Nerlove, M. (1975). Some problems in the use of income-contingent loans for the finance of higher education. Journal of Political Economy, 83(1), 157-184.
- Psacharopoulos, G., & Woodhall, M. (1985). Education for development: An analysis of investment choices. New York: Oxford University Press.
- Romer, P. M. (1986, October). Increasing returns and long run growth. Journal of Political Economy, 94(3), 1002-37.
- Rosenzweig, M. R., & Wolpin, K. (2000). Natural ‘natural experiments’ in economics. Journal of Economic Literature, 38(4), 827-874.
- Schultz, T. W. (1961). Investments in human capital. American Economic Review, 51(1), 1-17.
- Schultz, T. P. (1988). Education investments and returns. In H. Chenery & T. N. Srinivasan (Eds.), Handbook of Development Economics (pp. 543-620). Amsterdam: North Holland Publishing.
- Schultz, T. P. (1994). Human capital, family planning, and their effects on population growth. American Economic Review, 83(2), 255-260.
- Schultz, T. P. (1995). Investment in women’s human capital. Chicago: University of Chicago Press.
- Schultz, T. P. (1999). Health and schooling in Africa. Journal of Economic Perspectives, 13(3), 67 68.
- Schultz, T. P. (2001). School subsidies for the poor: Evaluating the Mexican Progresa poverty program. Economic Growth Center, Discussion Paper No. 834. New Haven, CT: Yale University.
- Schultz, T. P. (2002a). Why governments should invest more to educate girls. Economic Growth Center, Discussion Paper No. 836. New Haven, CT: Yale University. Schultz, T. P. (2002b). Why governments should invest more to educate girls. World Development, 30(2), 207-225.
- Sedlacek, G. (2001). Three-in-one social policy: Insurance, assistance, and investment through Latin America’s conditional targeted transfers. Washington, DC: InterAmerican Development Bank. Tang, W., & Parish, W. L. (2000). Chinese urban life under reform. Cambridge, England: Cambridge University Press.
- Tilak, J. B. G. (1997). Cost recovery in education. In C. Colclough (Ed.), Marketizing education and health in developing countries (pp. 63-89). New York: Clarendon Press, Oxford University Press.
- Topel, R. (1999). Labor markets and economic growth. In O. Ashenfelter & D. Cardin (Eds.), Handbook of Labor Economics (Vol. 3, chap. 44). Amsterdam: Elsevier.
- Woodhall, M. (Ed.). (1992). Student loans in developing countries. Higher Education, 23(4). Special Issue.
- World Bank (1986). World Development Report, 1986. New York: Oxford University Press for World Bank.
- World Bank. (2000). Higher education in developing countries. Washington, DC: Task Force on Higher Education and Society.
- World Bank. (2002). World Development Report, 2000-2001.
References
Albrecht, D., & Ziderman, A. (1991). Deferred cost recovery for higher education. Discussion Paper No. 137. Washington, DC: World Bank.
Arends-Kuenning, M., & Amin, S. (2000). The effects of schooling incentive programs on household resource allocation in Bangladesh. Policy Research Division, Working Paper 133. New York: Population Council.
Becker, G. S. (1964). Human capital. New York: Columbia University Press. Berthelmey, C., & Bourguignon, F. (1996). Growth and crisis in Côte d’Ivoire. Washington, DC: World Bank.
Bhagwati, J., & Partington, M. (Eds.). (1976). Taxing the brain drain. Amsterdam: North Holland Publishing Company.
Binswanger, H. P., & Rosenzweig, M. R. (Eds.) (1984). Contractual arrangements, employment and wages in rural labor markets in Asia. New Haven, CT: Yale University Press.
Boissiere, M., Knight, J. B., & Sabot, R. H. (1985). Earnings, schooling, ability and cognitive skills. American Economic Review, 75, 1026-30.
Burgess, R. S. L. (1997). Fiscal reform and extension of basic health and education. In C. Colclough (Ed.), Marketing education and health in developing countries. New York: Clarendon Press, Oxford University Press.
Card, D. (1999). The causal effects of education on earnings. In O. Ashenfelter & D. Card (Eds.), Handbook of Labor Economics (Vol. 3). Amsterdam, North Holland Publishing Company.
Card, D. (2001). Estimating the returns to schooling: Progress on some persistent problems. Econometrica, 69(5), 1127 1160.
Card, D., & Lemieux, T. (2001). Can falling supply explain the rising return to college for younger men? Quarterly Journal of Economics, 116(2), 705-746.
Chattopadhay, E., & Duflo, E. (2001). Women’s leadership and policy decisions: Evidence from a nationwide randomized experiment in India. MIT Discussion Paper. Cambridge, MA. Colclough, C. (1997). Marketing education and health in developing countries. New York: Clarendon Press, Oxford University Press.
Denison, E. F. (1962). Sources of economic growth in the United States and the alternatives before us. Supp. Paper No. 13. New York: Committee for Economic Development.
Duflo, E. (2001). Schooling and labor market consequences of school construction in Indonesia. American Economic Review, 91(4), 795-813.
Easterly, W. (2001). The elusive quest for growth. Cambridge, MA: MIT Press. Fei, J. C., & Ranis, G. (1964). Development of the labor surplus economy: Theory and policy. Homewood, IL: Richard D. Irwin.
Foster, A., & Rosenzweig, M. (1995). Learning by doing and learning from others: Human capital and technical change in agriculture, Journal of Political Economy, 103(6), 1176-1209.
Harris, J., & Todaro, M. (1970). Migration, unemployment and development. American Economic Review, 60(1), 126-142. Hinchliffe, K. (1993). Neo-liberal prescription for education finance: Unfortunately necessary or inherently undesirable? International Journal of Educational Development, 13(2), 183-187.
Jacoby, H. G., & Skoufias, E. (1997, July). Risk, financial markets, and human capital in a developing country. Review of Economic Studies, 64, 311-335.
Jaffe, A., Trajtenberg, M., & Henderson, R. (1993). Geographic localization of knowledge spillovers as evidence by patent citation. Quarterly Journal of Economics, 108(3), 577-598.
Jimenez, E. (1987). Pricing policies in social sectors: Cost recovery for education and health in developing countries. Baltimore, MD: Johns Hopkins University Press.
Johnstone, D. (1992), International comparisons of student financial support. In M. Woodhall (Ed.), Higher Education, 23(4), 24-44.
Jorgenson, D. W. (1995). Productivity. Vol. 1: Postwar U.S. economic growth. Cambridge, MA: MIT Press.
Kim, S., & Lee, J-H. (2001). Demand for education and developmental state: Private tutoring in South Korea. Social Science Research Electronic Paper, Collection No. 268284. Available at http://papers.ssrn.com/paper/taf?abstract_id=268284.
Kimalu, P. K., Nafala, N., Manda, D. K., Mwabu, G., & Mimeyi, M. S. (2001). Kenyan public education sector: Structure and performance. Paper prepared for the Kenyan Institute of Public Policy Research and Analysis, Nairobi.
King, E. M. (1997). Who pays for education in Indonesia. In C. Colclough (Ed.), Marketizing education and health in developing countries (pp. 165-182). New York: Clarendon Press, Oxford University Press.
Knight, J. B., & Sabot, R. H. (1981). The returns to education: Increasing with experience and decreasing in expansion. Oxford Bulletin of Economics and Statistics, 43(1), 51-71.
Knight, J. B., & Sabot, R. H. (1990). Education, skills and inequality: The East Africa national experiment. New York: Oxford University Press.
Kuznets, S. (1966). Modern economic growth: Rate, structure and spread. New Haven, CT: Yale University Press.
Lewis, A. (1954, May). Economic development with unlimited supplies of labor. Manchester School of Economics and Social Sciences, 22, 139-191.
Lucas, R. (1988). On the mechanics of economic developments. Journal of Monetary Economics, 22(1), 3-22.
Maluccio, J. A. (1997). Essays on development: Labor markets in rural Philippines. Unpublished Ph.D. dissertation, Yale University, New Haven, CT. Mincer, J. (1974). Schooling, experience and earnings. New York: Columbia University Press.
Moretti, E. (1998). Social returns to education and human capital externalities: Evidence from cities. Center for Labor Economics, Working Paper No. 9. Berkeley: University of California.
Mwabu, G., & Schultz, T. P. (2000). Wage premia for the education and location of workers in South Africa, by gender and race. Economic Development and Cultural Change, 60(1), 126-142. 1998 Economic Growth Center, Discussion Paper No. 785.
National Research Council. (1986). Population growth and economic development policy questions. Washington, DC: National Academy Press. National Research Council. (1993). Population dynamics of Kenya. Washington, DC: National Academy Press.
Nerlove, M. (1975). Some problems in the use of income-contingent loans for the finance of higher education. Journal of Political Economy, 83(1), 157-184.
Psacharopoulos, G., & Woodhall, M. (1985). Education for development: An analysis of investment choices. New York: Oxford University Press.
Romer, P. M. (1986, October). Increasing returns and long run growth. Journal of Political Economy, 94(3), 1002-37.
Rosenzweig, M. R., & Wolpin, K. (2000). Natural ‘natural experiments’ in economics. Journal of Economic Literature, 38(4), 827-874.
Schultz, T. W. (1961). Investments in human capital. American Economic Review, 51(1), 1-17.
Schultz, T. P. (1988). Education investments and returns. In H. Chenery & T. N. Srinivasan (Eds.), Handbook of Development Economics (pp. 543-620). Amsterdam: North Holland Publishing.
Schultz, T. P. (1994). Human capital, family planning, and their effects on population growth. American Economic Review, 83(2), 255-260.
Schultz, T. P. (1995). Investment in women’s human capital. Chicago: University of Chicago Press.
Schultz, T. P. (1999). Health and schooling in Africa. Journal of Economic Perspectives, 13(3), 67 68.
Schultz, T. P. (2001). School subsidies for the poor: Evaluating the Mexican Progresa poverty program. Economic Growth Center, Discussion Paper No. 834. New Haven, CT: Yale University.
Schultz, T. P. (2002a). Why governments should invest more to educate girls. Economic Growth Center, Discussion Paper No. 836. New Haven, CT: Yale University. Schultz, T. P. (2002b). Why governments should invest more to educate girls. World Development, 30(2), 207-225.
Sedlacek, G. (2001). Three-in-one social policy: Insurance, assistance, and investment through Latin America’s conditional targeted transfers. Washington, DC: InterAmerican Development Bank. Tang, W., & Parish, W. L. (2000). Chinese urban life under reform. Cambridge, England: Cambridge University Press.
Tilak, J. B. G. (1997). Cost recovery in education. In C. Colclough (Ed.), Marketizing education and health in developing countries (pp. 63-89). New York: Clarendon Press, Oxford University Press.
Topel, R. (1999). Labor markets and economic growth. In O. Ashenfelter & D. Cardin (Eds.), Handbook of Labor Economics (Vol. 3, chap. 44). Amsterdam: Elsevier.
Woodhall, M. (Ed.). (1992). Student loans in developing countries. Higher Education, 23(4). Special Issue.
World Bank (1986). World Development Report, 1986. New York: Oxford University Press for World Bank.
World Bank. (2000). Higher education in developing countries. Washington, DC: Task Force on Higher Education and Society.
World Bank. (2002). World Development Report, 2000-2001.