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Effects of Human Capital on Farm and Non-Farm Productivity and Occupational Stratification in Rural Pakistan

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Author Info
Takashi Kurosaki
Humayun Khan
Abstract

This paper investigates the effects of human capital on productivity using micro panel data of rural households in the NorthWest Frontier Province, Pakistan, where a substantial job stratification is observed in terms of income and education. To clarify the mechanism underlying this stratification, the human capital effects are estimated for wages(individual level) and for self-employed activities(household level), and for farm and non-farm sectors. Estimation results show a clear contrast between farm and non-farm sectors - wages and productivity in non-farm activities rise with education at an increasing rate, whereas those in agriculture respond only to the primary education.

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Paper provided by Institute of Economic Research, Hitotsubashi University in its series Hi-Stat Discussion Paper Series with number d04-46.

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Date of creation: Nov 2004
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Handle: RePEc:hst:hstdps:d04-46

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Related research
Keywords: human capital returns to education non-farm employment self-employment

Find related papers by JEL classification:
O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

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  1. Sawada, Yasayuki & Lokshin, Michael, 2001. "Household schooling decisions in rural Pakistan," Policy Research Working Paper Series 2541, The World Bank. [Downloadable!]
  2. Lee, Lung-Fei, 1983. "Generalized Econometric Models with Selectivity," Econometrica, Econometric Society, vol. 51(2), pages 507-12, March. [Downloadable!] (restricted)
  3. 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.
  4. Lanjouw, Peter, 1999. "Rural Nonagricultural Employment and Poverty in Ecuador," Economic Development and Cultural Change, University of Chicago Press, vol. 48(1), pages 91-122, October.
  5. 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.
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  6. Dubin, Jeffrey A & McFadden, Daniel L, 1984. "An Econometric Analysis of Residential Electric Appliance Holdings and Consumption," Econometrica, Econometric Society, vol. 52(2), pages 345-62, March. [Downloadable!] (restricted)
  7. Yang, Dennis Tao & An, Mark Yuying, 2002. "Human capital, entrepreneurship, and farm household earnings," Journal of Development Economics, Elsevier, vol. 68(1), pages 65-88, June. [Downloadable!] (restricted)
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  8. Lockheed, Marlaine E & Jamison, Dean T & Lau, Lawrence J, 1980. "Farmer Education and Farm Efficiency: A Survey," Economic Development and Cultural Change, University of Chicago Press, vol. 29(1), pages 37-76, October.
  9. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863 Elsevier. [Downloadable!] (restricted)
  10. Yang, Dennis Tao, 1997. "Education and Off-Farm Work," Economic Development and Cultural Change, University of Chicago Press, vol. 45(3), pages 613-32, April.
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  11. Munir Ahmad & Ghulam Mustafa Chaudhry & Mohammad Iqbal, 2002. "Wheat Productivity, Efficiency, and Sustainability: A Stochastic Production Frontier Analysis," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 41(4), pages 643-663. [Downloadable!]
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  12. Jolliffe, Dean, 1997. "Whose education matters in the determination of household income," FCND discussion papers 39, International Food Policy Research Institute (IFPRI). [Downloadable!]
  13. Nielsen, Helena Skyt & Westergard-Nielsen, Niels, 2001. "Returns to Schooling in Less Developed Countries: New Evidence from Zambia," Economic Development and Cultural Change, University of Chicago Press, vol. 49(2), pages 365-94, January.
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