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Schooling, Literacy, Numeracy and Labor Market Success

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Author Info
Chiswick, Barry R. () (University of Illinois, Chicago and IZA, Bonn)
Lee, Yew Liang (University of Western Australia)
Miller, Paul W. (University of Western Australia)

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Abstract

This paper uses data from the 1996 Australian Survey of Aspects of Literacy to examine the effects on labour market outcomes of literacy, numeracy and educational attainment. The survey includes a range of literacy and numeracy variables that are highly inter-correlated. A "general to specific" approach identifies the most relevant literacy and numeracy variables. Including the others adds little explanatory power. Among males and females separately about half of the total effect of education on labour force participation and on unemployment can be attributed to literacy and numeracy (the indirect effect) and about half to the direct effect of education. There is apparently no indirect effect of labour market experience through literacy and numeracy on participation or unemployment. The direct and total effects of experience are the same. The findings suggest that education is a value added process in which skills, including literacy and numeracy, are improved and that these skills enhance labour market outcomes.

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Publisher Info
Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 450.

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Length: 56 pages
Date of creation: Mar 2002
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Handle: RePEc:iza:izadps:dp450

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Related research
Keywords: Human capital; schooling; literacy; numeracy; earnings screening; Australia;

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Find related papers by JEL classification:
J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
I21 - Health, Education, and Welfare - - Education - - - Analysis of Education

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References listed on IDEAS
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.:
  1. McNabb, Robert & Richardson, Sue, 1989. "Earnings, Education and Experience: Is Australia Different?," Australian Economic Papers, Blackwell Publishing, vol. 28(52), pages 57-75, June.
  2. Lang, Kevin & Kropp, David, 1986. "Human Capital versus Sorting: The Effects of Compulsory Attendance Laws," The Quarterly Journal of Economics, MIT Press, vol. 101(3), pages 609-24, August. [Downloadable!] (restricted)
  3. Miller, Paul W & Volker, Paul A, 1984. "The Screening Hypothesis: An Application of the Wiles Test," Economic Inquiry, Oxford University Press, vol. 22(1), pages 121-27, January.
  4. Schultz, Theodore W, 1975. "The Value of the Ability to Deal with Disequilibria," Journal of Economic Literature, American Economic Association, vol. 13(3), pages 827-46, September. [Downloadable!] (restricted)
  5. Anh T. Le & Paul W. Miller, 1998. "The ABS Survey of Employment and Unemployment Patterns," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 31(3), pages 290-297. [Downloadable!] (restricted)
  6. Weiss, Andrew, 1983. "A Sorting-cum-Learning Model of Education," Journal of Political Economy, University of Chicago Press, vol. 91(3), pages 420-42, June. [Downloadable!] (restricted)
  7. Chiswick, Barry R. & Hurst, Michael E., 2000. "The Employment, Unemployment and Unemployment Compensation Benefits of Immigrants," IZA Discussion Papers 129, Institute for the Study of Labor (IZA). [Downloadable!]
  8. Le, Anh T & Miller, Paul W, 2000. "Australia's Unemployment Problem," The Economic Record, The Economic Society of Australia, vol. 76(232), pages 74-104, March.
  9. Barry Chiswick, 1999. "Are Immigrants Favorably Self-Selected?," American Economic Review, American Economic Association, vol. 89(2), pages 181-185, May. [Downloadable!] (restricted)
  10. Preston, Alison, 1997. "Where Are We Now with Human Capital Theory in Australia?," The Economic Record, The Economic Society of Australia, vol. 73(220), pages 51-78, March.
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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.)

  1. Brian A'Hearn & Jörg Baten & Dorothee Crayen, 2006. "Quantifying Quantitative Literacy: Age Heaping and the History of Human Capital," Economics Working Papers 996, Department of Economics and Business, Universitat Pompeu Fabra. [Downloadable!]
    Other versions:
  2. Niels-Hugo Blunch & Claus C Pörtner, 2005. "Literacy, Skills and Welfare: Effects of Participation in Adult Literacy Programs," Working Papers UWEC-2005-23-R, University of Washington, Department of Economics, revised Aug 2009. [Downloadable!]
  3. Paul W. Miller & Charles Mulvey & Nick Martin, 2004. "A Test of the Sorting Model of Education in Australia," Economics Discussion / Working Papers 04-12, The University of Western Australia, Department of Economics. [Downloadable!]
    Other versions:
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