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Africa's education enigma? The Nigerian story

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  • Uwaifo Oyelere, Ruth

Abstract

In the last two decades, the social and economic benefits of formal education in Sub-Saharan Africa have been debated. Anecdotal evidence points to low returns to education in Africa. Unfortunately, there is limited econometric evidence to support these claims at the micro level. In this study, I focus on Nigeria, a country that holds 1/5 of Africa's population. I use instruments based on the exogenous timing of the implementation and withdrawal of free primary education across regions in this country to consistently estimate the returns to education in the late 1990s. The results show the average returns to education are particularly low in the 90s, in contrast to conventional wisdom for developing countries (2.8% for every extra year of schooling between 1997 and 1999). Surprisingly, I find no significant differences between OLS and IV estimates of returns to education when necessary controls are included in the wage equation. The low returns to education results shed new light on both the changes in demand for education in Nigeria and the increased emigration rates from African countries that characterized the 90s.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Development Economics.

Volume (Year): 91 (2010)
Issue (Month): 1 (January)
Pages: 128-139

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Handle: RePEc:eee:deveco:v:91:y:2010:i:1:p:128-139

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Web page: http://www.elsevier.com/locate/devec

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Keywords: Human capital Instrumental variables Nigeria Returns to education Schooling;

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  1. Mwabu, Germano & Schultz, T Paul, 1996. "Education Returns across Quantiles of the Wage Function: Alternative Explanations for Returns to Education by Race in South Africa," American Economic Review, American Economic Association, vol. 86(2), pages 335-39, May.
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  18. Harmon, C & Ian Walker, 1995. "Estimates of the economic return to schooling for the UK," IFS Working Papers W95/12, Institute for Fiscal Studies.
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Cited by:
  1. Ogundari, Kolawole, 2012. "Returns to Education Revisited and Effects of Education on Household Welfare in Nigeria," 2012 Conference, August 31, 2012, Nelson, New Zealand 136051, New Zealand Agricultural and Resource Economics Society.
  2. Gonzales, Naihobe & Uwaifo Oyelere, Ruth, 2009. "Are Returns to Education on the Decline in Venezuela and Does Mission Sucre Have a Role to Play?," IZA Discussion Papers 4206, Institute for the Study of Labor (IZA).
  3. Manos Antoninis, 2012. "Tackling the largest global education challenge? Secular and religious education in northern Nigeria," CSAE Working Paper Series 2012-17, Centre for the Study of African Economies, University of Oxford.
  4. Uwaifo Oyelere, Ruth, 2008. "Understanding Low Average Returns to Education in Africa: The Role of Heterogeneity across Education Levels and the Importance of Political and Economic Reforms," IZA Discussion Papers 3766, Institute for the Study of Labor (IZA).
  5. Jeremy D. Foltz & Ousman Gajigo, 2012. "Working Paper 145 - Assessing the Returns to Education in the Gambia," Working Paper Series 376, African Development Bank.
  6. Quamrul H. Ashraf & David N. Weil & Joshua Wilde, 2011. "The Effect of Fertility Reduction on Economic Growth," Department of Economics Working Papers 2013-11, Department of Economics, Williams College, revised Feb 2013.
  7. Jeremy D. Foltz & Ousman Gajigo, 2012. "Assessing the Returns to Education in The Gambia-super- †," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 21(4), pages 580-608, August.
  8. Manos Antoninis, 2012. "Tackling the largest global education challenge? Secular and religious education in northern Nigeria," Economics Series Working Papers WPS/2012-17, University of Oxford, Department of Economics.

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