Whose education matters in the determination of household income

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Whose education matters in the determination of household income

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Jolliffe, Dean

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Dean Jolliffe

Abstract

This paper aims to answer how best to model education attainment, which is an individual-level variable, in household-level income functions. The accepted practice in the literature is to use the education level of the household head. This paper compares the head-of-household model to three competing models and concludes that the maximum or average level of education in the household is a better explanatory variable of household income. Least absolute deviations (LAD) estimators and censored least absolute deviations (CLAD) estimators are used to predict income. Standard errors, which are robust to violations of homoscedasticity and independence, are generated by a boot-strap method that replicates the two-stage sample design.

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Paper provided by International Food Policy Research Institute (IFPRI) in its series FCND discussion papers with number 39.

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Date of creation: 1997
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Handle: RePEc:fpr:fcnddp:39

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Keywords: Education income

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References listed on IDEAS
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Psacharopoulos, George, 1994. "Returns to investment in education: A global update," World Development, Elsevier, vol. 22(9), pages 1325-1343, September. [Downloadable!] (restricted)
Other versions:
- Psacharopoulos, George, 1993. "Returns to investment in education : a global update," Policy Research Working Paper Series 1067, The World Bank. [Downloadable!]
Lockheed, Marlaine E & Jamison, Dean T & Lau, Lawrence J, 1987. "Farmer Education and Farm Efficiency: Reply," Economic Development and Cultural Change, University of Chicago Press, vol. 35(3), pages 643-44, April.
Breusch, T S & Pagan, A R, 1979. "A Simple Test for Heteroscedasticity and Random Coefficient Variation," Econometrica, Econometric Society, vol. 47(5), pages 1287-94, September. [Downloadable!] (restricted)
Arabmazar, Abbas & Schmidt, Peter, 1981. "Further evidence on the robustness of the Tobit estimator to heteroskedasticity," Journal of Econometrics, Elsevier, vol. 17(2), pages 253-258, November. [Downloadable!] (restricted)
Fane, George, 1975. "Education and the Managerial Efficiency of Farmers," The Review of Economics and Statistics, MIT Press, vol. 57(4), pages 452-61, November. [Downloadable!] (restricted)
Jolliffe, Dean, 1998. "Skills, Schooling, and Household Income in Ghana," World Bank Economic Review, Oxford University Press, vol. 12(1), pages 81-104, January.
Pagan, Adrian & Vella, Frank, 1989. "Diagnostic Tests for Models Based on Individual Data: A Survey," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 4(S), pages S29-59, Supplemen. [Downloadable!] (restricted)
Jamison, Dean T. & Moock, Peter R., 1984. "Farmer education and farm efficiency in Nepal: The role of schooling, extension services, and cognitive skills," World Development, Elsevier, vol. 12(1), pages 67-86, January. [Downloadable!] (restricted)
Koenker, Roger W & Bassett, Gilbert, Jr, 1978. "Regression Quantiles," Econometrica, Econometric Society, vol. 46(1), pages 33-50, January. [Downloadable!] (restricted)
Powell, James L., 1984. "Least absolute deviations estimation for the censored regression model," Journal of Econometrics, Elsevier, vol. 25(3), pages 303-325, July. [Downloadable!] (restricted)

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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

Mark Rosenzweig & Andrew D. Foster, 1996. "Household Division, Inequality and Rural Economic Growth," Home Pages _074, University of Pennsylvania. [Downloadable!]
Sonia Bhalotra, 2000. "Is Child Work Necessary?," Econometric Society World Congress 2000 Contributed Papers 0500, Econometric Society. [Downloadable!]
Other versions:
- Sonia Bhalotra, 2003. "Is Child Work Necessary?," Bristol Economics Discussion Papers 03/554, Department of Economics, University of Bristol, UK. [Downloadable!]
- Sonia R Bhalotra, 2000. "Is Child Work Necessary?," STICERD - Development Economics Papers 26, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE. [Downloadable!]
- Sonia Bhalotra, 2007. "Is Child Work Necessary?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 69(1), pages 29-55, 02. [Downloadable!] (restricted)
Datt, Gaurav, 1998. "Computational tools for poverty measurement and analysis," FCND discussion papers 50, International Food Policy Research Institute (IFPRI). [Downloadable!]
Takashi Kurosaki & Humayun Khan, 2004. "Effects of Human Capital on Farm and Non-Farm Productivity and Occupational Stratification in Rural Pakistan," Hi-Stat Discussion Paper Series d04-46, Institute of Economic Research, Hitotsubashi University. [Downloadable!]
Datt, Gaurav & Jolliffe, Dean, 1999. "Determinants of poverty in Egypt, 1997," FCND discussion papers 75, International Food Policy Research Institute (IFPRI). [Downloadable!]
Firman Witoelar, 2005. "Inter-household Allocations within Extended Family: Evidence from the Indonesia Family Life Survey," Working Papers 912, Economic Growth Center, Yale University. [Downloadable!]

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