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Production Externalities of Education: Evidence from Rural Ethiopia

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  • Sharada Weir
  • John Knight

Abstract

Schooling has externality effects in agriculture when, in the course of conducting their own private economic activities, educated farmers raise the productivity of their uneducated neighbours. This paper seeks to determine the potential size and source of such benefits for rural areas of Ethiopia, where school enrolment is low and the private returns to education may not be apparent. Average and stochastic frontier production functions are estimated, including household and community education, as explanatory variables to measure the productivity and efficiency of farmers. In each case, internal and external returns to schooling are compared. We find substantial and significant externality benefits of education in increasing average production and shifting out the frontier. External benefits of schooling may be several times as high as internal benefits in this regard. However, we are unable to find evidence that technical efficiency is subject to externality effects. Our results suggest that adoption and diffusion of innovations that push out the frontier is the source of externalities to schooling. Copyright 2007, Oxford University Press.

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Bibliographic Info

Article provided by Centre for the Study of African Economies (CSAE) in its journal Journal of African Economies.

Volume (Year): 16 (2007)
Issue (Month): 1 (January)
Pages: 134-165

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Handle: RePEc:oup:jafrec:v:16:y:2007:i:1:p:134-165

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Cited by:
  1. Gille, Véronique, 2011. "Education spillovers in farm productivity: empirical evidence in rural India," Proceedings of the German Development Economics Conference, Berlin 2011 31, Verein für Socialpolitik, Research Committee Development Economics.
  2. Conto, Francesco & Fiore, Mariantonietta & La Sala, Piermichele & Papapietro, Paolo, 2012. "The Role Of Education, Knowledge And Human Resources For The Agricultural Development In The Perspective Of New Cap: An Hypothesis Of Change In Basilicata," APSTRACT: Applied Studies in Agribusiness and Commerce, AGRIMBA, vol. 6.
  3. Mussa, Richard, 2014. "Externalities of Education on Efficiency and Production Uncertainty of Maize in Rural Malawi," MPRA Paper 54628, University Library of Munich, Germany.
  4. Hanjra, Munir A. & Ferede, Tadele & Gutta, Debel Gemechu, 2009. "Reducing poverty in sub-Saharan Africa through investments in water and other priorities," Agricultural Water Management, Elsevier, vol. 96(7), pages 1062-1070, July.
  5. John Knight & Li Shi & Deng Quheng, 2008. "Education and the Poverty Trap in Rural China," Economics Series Working Papers WPS/2008-02, University of Oxford, Department of Economics.

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