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Expected Returns to Education and Experience in the United Arab Emirates

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  • Squalli Jay

    (American University of Sharjah)

Abstract

This paper makes use of a sample of 30,043 mostly unemployed Emiratis and a subsample of 376 employed Emiratis drawn from the Tanmia database to estimate the expected returns to education and experience in the UAE. Overall, we find evidence of a U-shaped relationship between expected wages and education and between expected wages and experience for both males and females, suggesting that the wage expectations of unemployed male and female Emiratis may be too unrealistic and thus could explain the challenges faced in finding suitable employment. It would appear from this study that UAE policymakers face serious challenges in ridding their economy of its reliance on skilled foreign expatriates without playing an active role in linking wages to education and productivity in the public sector.

Suggested Citation

  • Squalli Jay, 2012. "Expected Returns to Education and Experience in the United Arab Emirates," Review of Middle East Economics and Finance, De Gruyter, vol. 8(2), pages 1-17, October.
  • Handle: RePEc:bpj:rmeecf:v:8:y:2012:i:2:n:4
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    References listed on IDEAS

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    1. Baldauf, Markus & Santos Silva, J.M.C., 2012. "On the use of robust regression in econometrics," Economics Letters, Elsevier, vol. 114(1), pages 124-127.
    2. World Bank, 2008. "The Road Not Traveled : Education Reform in the Middle East and North Africa," World Bank Publications, The World Bank, number 6303.
    3. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1.
    4. White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-838, May.
    5. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters,in: Schooling, Experience, and Earnings, pages 1-4 National Bureau of Economic Research, Inc.
    6. Heckman, James, 2013. "Sample selection bias as a specification error," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 31(3), pages 129-137.
    7. Fatma El-Hamidi, 2004. "General or Vocational? Evidence on School Choice, Returns, and “Sheep Skin” Effects from Egypt 1998," Working Papers 0406, Economic Research Forum, revised 01 Aug 2004.
    8. Al-Qudsi, Sulayman S., 1985. "Earnings differences in the labor market of the Arab Gulf states : The case of Kuwait," Journal of Development Economics, Elsevier, vol. 18(1), pages 119-132.
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