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Do schooling years improve the earning capacity of lower income groups?

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  • Dawood Mamoon

Abstract

The paper analyses the relationship between the popular Barro and Lee (2001) 'average years of schooling' with income inequality, wage inequality, and income deciles and income percentiles for the sample of developed and developing countries. The results suggest that countries where students complete higher numbers of years of schooling on average also perform better on relative incomes meaning that increase in average income comes from improvements in the earning capacity of the lower income groups or unskilled labour. The paper also finds that an educated population means that there is redistribution of income from the rich to the poor creating thriving middle class.

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Bibliographic Info

Article provided by Inderscience Enterprises Ltd in its journal Int. J. of Education Economics and Development.

Volume (Year): 3 (2012)
Issue (Month): 1 ()
Pages: 1-9

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Handle: RePEc:ids:ijeded:v:3:y:2012:i:1:p:1-9

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Web page: http://www.inderscience.com/browse/index.php?journalID==346

Related research

Keywords: education; income inequality wage inequality; earning capacity; lower income groups; schooling years; income redistribution; educated population.;

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  1. Jeffrey Sachs & Andrew Warner, 1995. "Economic Reform and the Progress of Global Integration," Harvard Institute of Economic Research Working Papers 1733, Harvard - Institute of Economic Research.
  2. Edwards, Sebastian, 1998. "Openness, Productivity and Growth: What Do We Really Know?," Economic Journal, Royal Economic Society, vol. 108(447), pages 383-98, March.
  3. Barro, Robert J & Lee, Jong-Wha, 2001. "International Data on Educational Attainment: Updates and Implications," Oxford Economic Papers, Oxford University Press, vol. 53(3), pages 541-63, July.
  4. Pritchett, Lant, 1996. "Measuring outward orientation in LDCs: Can it be done?," Journal of Development Economics, Elsevier, vol. 49(2), pages 307-335, May.
  5. Daron Acemoglu & Simon Johnson & James A. Robinson, 2001. "The Colonial Origins of Comparative Development: An Empirical Investigation," American Economic Review, American Economic Association, vol. 91(5), pages 1369-1401, December.
  6. Pereira, Pedro Telhado & Martins, Pedro Silva, 2002. "Does Education Reduce Wage Inequality? Quantile Regressions Evidence from Fifteen European Countries," Discussion Papers 709, The Research Institute of the Finnish Economy.
  7. Jean-Claude Berthélemy, 2004. "To what extent are African education policies pro-poor ?," Cahiers de la Maison des Sciences Economiques bla04003, Université Panthéon-Sorbonne (Paris 1).
  8. Barro, Robert J & Lee, Jong Wha, 1996. "International Measures of Schooling Years and Schooling Quality," American Economic Review, American Economic Association, vol. 86(2), pages 218-23, May.
  9. Daron Acemoglu, 2001. "Human Capital Policies and the Distribution of Income: A Framework for Analysis and Literature Review," Treasury Working Paper Series 01/03, New Zealand Treasury.
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