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Returns to Human Capital in Pakistan: A Gender Disaggregated Analysis

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Author Info

  • Zafar Mueen Nasir

    (Pakistan Institute of Development Economics, Islamabad.)

Abstract

The impact of human capital variables on the earnings of regular wage employees is explored in this paper. Besides education and experience, literacy index, technical training, and school quality are included in the earning functions estimated for individuals. The credentialist view that education does not improve productivity—that it rather provides positive signals about productivity—is also tested. The results are based on the Pakistan Integrated Household Survey 1995-96 data, which provides information on many aspects of the individual’s characteristics missing in other surveys. The results of the study provide ample evidence in favour of human capital as a productivity-enhancing device for both male and female workers. All human capital variables are found to be statistically significant, having positive magnitude. The diploma effect is not very important for Pakistani workers, as only a few diploma dummies are statistically significant.

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File URL: http://www.pide.org.pk/pdf/PDR/2002/Volume1/1-28.pdf
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Bibliographic Info

Article provided by Pakistan Institute of Development Economics in its journal The Pakistan Development Review.

Volume (Year): 41 (2002)
Issue (Month): 1 ()
Pages: 1-28

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Handle: RePEc:pid:journl:v:41:y:2002:i:1:p:1-28

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References

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  1. Gaag, Jacques & van der Vijverberg, Wim, 1989. "Wage Determinants in Cote d'Ivoire: Experience, Credentials, and Human Capital," Economic Development and Cultural Change, University of Chicago Press, vol. 37(2), pages 371-81, January.
  2. Behrman, Jere R. & Khan, Shahrukh & Ross, David & Sabot, Richard, 1997. "School quality and cognitive achievement production: A case study for rural Pakistan," Economics of Education Review, Elsevier, vol. 16(2), pages 127-142, April.
  3. Richard H. Sabot, 1992. "Human Capital Accumulation in Post Green Revolution Rural Pakistan: A Progress Report," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 31(4), pages 449-490.
  4. Behrman, J.R. & Ross, D. & Sabot, R. & Alderman, H., 1995. "The Returns to endogenous Human Capital in Pakistan's Rural Wage Labour Market," Center for Development Economics 141, Department of Economics, Williams College.
  5. Boissiere, M & Knight, J B & Sabot, R H, 1985. "Earnings, Schooling, Ability, and Cognitive Skills," American Economic Review, American Economic Association, vol. 75(5), pages 1016-30, December.
  6. Behrman, J.R. & Ross, D. & Sabot, R. & Tropp, M., 1995. "Improving the Quality versus Increasing the Quantity of Schooling," Center for Development Economics 140, Department of Economics, Williams College.
  7. Yasuyuki Sawada, 1997. "Human Capital Investments in Pakistan: Implications of Micro Evidence from Rural Households," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 36(4), pages 695-712.
  8. David Neumark & Sanders D. Korenman, 1988. "Does marriage really make men more productive?," Finance and Economics Discussion Series 29, Board of Governors of the Federal Reserve System (U.S.).
  9. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," Journal of Political Economy, University of Chicago Press, vol. 70, pages 9.
  10. Arrow, Kenneth J., 1973. "Higher education as a filter," Journal of Public Economics, Elsevier, vol. 2(3), pages 193-216, July.
  11. Summers, Anita A & Wolfe, Barbara L, 1977. "Do Schools Make a Difference?," American Economic Review, American Economic Association, vol. 67(4), pages 639-52, September.
  12. Nadeem Ul Haque, 1977. "An Economic Analysis of Personal Earnings in Rawalpindi City," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 16(4), pages 353-382.
  13. Behrman, Jere R & Birdsall, Nancy, 1983. "The Quality of Schooling: Quantity Alone is Misleading," American Economic Review, American Economic Association, vol. 73(5), pages 928-46, December.
  14. Harold Alderman & Jere R. Behrman & David R. Ross & Richard Sabot, 1996. "Decomposing the Gender Gap in Cognitive Skills in a Poor Rural Economy," Journal of Human Resources, University of Wisconsin Press, vol. 31(1), pages 229-254.
  15. Psacharopoulos, George, 1994. "Returns to investment in education: A global update," World Development, Elsevier, vol. 22(9), pages 1325-1343, September.
  16. Richard H. Sabot, 1989. "Human Capital Accumulation in Post-green Revolution Pakistan: Some Preliminary Results," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 28(4), pages 413-436.
  17. Tayyeb Shabbir, 1991. "Sheepskin Effects in the Returns to Education in a Developing Country," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 30(1), pages 1-19.
  18. T. Paul Schultz & Germano Mwabu, 1998. "Wage Premia for Education and Location, By Gender and Race in South Africa," Working Papers 785, Economic Growth Center, Yale University.
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Citations

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Cited by:
  1. Farhan Sami Khan & Imran Ashraf Toor, 2003. "Changes in Returns to Education in Pakistan: 1990-2002," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 8(2), pages 85-98, Jul-Dec.
  2. Muhammad Irfan, 2010. "A Review of the Labour Market Research at PIDE 1957-2009," PIDE Books, Pakistan Institute of Development Economics, number 2010:1 edited by Rashid Amjad & Aurangzeb A. Hashmi, March.
  3. Zafar Mueen Nasir, 2005. "An Analysis of Occupational Choice in Pakistan: A Multinomial Approach," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 44(1), pages 57-79.
  4. Madeeha Gohar Qureshi, 2012. "The Gender Differences in School Enrolment and Returns to Education in Pakistan," PIDE-Working Papers 2012:84, Pakistan Institute of Development Economics.
  5. Monazza Aslam, 2006. "Rates of Return to Education by Gender in Pakistan," Economics Series Working Papers GPRG-WPS-064, University of Oxford, Department of Economics.

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