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When more schooling is not worth the effort: another look at the dropout decisions of disadvantaged students in Uruguay

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  • Rossana Patrón

    () (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)

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    Abstract

    In Uruguay, similar to many developing countries, the economic return to lower secondary studies is low. When heterogeneity is introduced in the analysis, it can be shown that differences in the quality of education and in the probability of repetition mark the contrast between an attractive and an inconvenient investment in secondary education between advantaged and disadvantaged students. The values of internal rate of return computed for the Uruguayan case allow concluding that, paradoxically, lower secondary education is an inconvenient investment for disadvantaged students, even disregarding the possibility of them not being able to afford the opportunity costs, explaining the heavy dropout rates of this student type. These results cast some serious doubts on the fairness of compulsory schooling laws that are not accompanied by complementary policies to ensure equal learning outcomes across socioeconomic groups.

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    File URL: http://www.fcs.edu.uy/archivos/0511.pdf
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    Bibliographic Info

    Paper provided by Department of Economics - dECON in its series Documentos de Trabajo (working papers) with number 0511.

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    Length: 13 pages
    Date of creation: Feb 2011
    Date of revision:
    Handle: RePEc:ude:wpaper:0511

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    Keywords: education returns; school quality; repetition rates;

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    1. Behrman, Jere R & Deolalikar, Anil B, 1991. "School Repetition, Dropouts, and the Rates of Return to Schooling: The Case of Indonesia," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 53(4), pages 467-80, November.
    2. Psacharopoulos, George & Patrinos, Harry Anthony, 2002. "Returns to investment in education : a further update," Policy Research Working Paper Series 2881, The World Bank.
    3. Brian A. Jacob & Lars Lefgren, 2002. "Remedial Education and Student Achievement: A Regression-Discontinuity Analysis," NBER Working Papers 8918, National Bureau of Economic Research, Inc.
    4. Eric A. Hanushek, 1979. "Conceptual and Empirical Issues in the Estimation of Educational Production Functions," Journal of Human Resources, University of Wisconsin Press, vol. 14(3), pages 351-388.
    5. Eric A. Hanushek & Victor Lavy & Kohtaro Hitomi, 2008. "Do Students Care about School Quality? Determinants of Dropout Behavior in Developing Countries," Journal of Human Capital, University of Chicago Press, vol. 2(1), pages 69-105.
    6. Brian Jacob & Lars Lefgren, 2007. "The Effect of Grade Retention on High School Completion," NBER Working Papers 13514, National Bureau of Economic Research, Inc.
    7. Zvi Eckstein & Kenneth I. Wolpin, 1999. "Why Youths Drop Out of High School: The Impact of Preferences, Opportunities, and Abilities," Econometrica, Econometric Society, vol. 67(6), pages 1295-1340, November.
    8. Glewwe, Paul, 1996. "The relevance of standard estimates of rates of return to schooling for education policy: A critical assessment," Journal of Development Economics, Elsevier, vol. 51(2), pages 267-290, December.
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