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Human Capital Investments in Pakistan: Implications of Micro Evidence from Rural Households

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  • Yasuyuki Sawada

    (Ph.D. candidate in the Department of Economics, Stanford University, USA.)

Abstract

A number of cross-country studies suggest that the Pakistani aggregate human capital investments, measured by educational performance, are low relative to other countries of similar per capita income levels. This paper investigates the implications of micro evidence on schooling from rural Pakistan for an understanding of the cases of low human capital investments. The results of school-entrant and dropout regressions using household panel data indicate that the permanent and transitory income movements affect children’s schooling behaviour, indicating credit market imperfections. Hence, the human capital investments in rural Pakistan may be discouraged by poverty, combined with incompletely insured income volatility. Moreover, our analysis points out that there is a distinct gender difference in education.

Suggested Citation

  • Yasuyuki Sawada, 1997. "Human Capital Investments in Pakistan: Implications of Micro Evidence from Rural Households," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 36(4), pages 695-712.
    • Handle: RePEc:pid:journl:v:36:y:1997:i:4:p:695-712
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    File URL: http://www.pide.org.pk/pdf/PDR/1997/Volume4/695-712.pdf
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    References listed on IDEAS

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    1. Morduch, Jonathan, 1994. "Poverty and Vulnerability," American Economic Review, American Economic Association, vol. 84(2), pages 221-225, May.
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    3. Kurosaki, Takashi & Fafchamps, Marcel, 2002. "Insurance market efficiency and crop choices in Pakistan," Journal of Development Economics, Elsevier, vol. 67(2), pages 419-453, April.
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    6. Robert M. Townsend, 1995. "Consumption Insurance: An Evaluation of Risk-Bearing Systems in Low-Income Economies," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 83-102, Summer.
    7. Jere R. Behrman & Ryan Schneider, 1993. "An International Perspective on Pakistani Human Capital Investments in the Last Quarter Century," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 32(1), pages 1-68.
    8. Nancy Birdsall & David Ross & Richard Sabot, 1993. "Underinvestment in Education: How Much Growth has Pakistan Foregone?," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 32(4), pages 453-499.
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    Cited by:

    1. Jafarey, S. & Mainali, R. M. & Montes-Rojas, G., 2014. "The Anticipation Effect of Marriage on Female Education: Theory and Evidence from Nepal," Working Papers 15/12, Department of Economics, City University London.
    2. Mughal, Abdul Waheed & Aldridge, Jo & Monaghan, Mark, 2019. "Perspectives of dropped-out children on their dropping out from public secondary schools in rural Pakistan," International Journal of Educational Development, Elsevier, vol. 66(C), pages 52-61.
    3. Blunch, Niels-Hugo & Canagarajah, Sudharshan & Goyal, Sangeeta, 2002. "Short- and long-term impacts of economic policies on child labor and schooling in Ghana," Social Protection Discussion Papers and Notes 25527, The World Bank.
    4. Umer Khalid & Lubna Shahnaz & Hajira Bibi, 2005. "Determinants of Poverty in Pakistan: A Multinomial Logit Approach," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 10(1), pages 65-81, Jan-Jun.
    5. Sawada, Yasayuki & Lokshin, Michael, 2001. "Household schooling decisions in rural Pakistan," Policy Research Working Paper Series 2541, The World Bank.
    6. Hina Nazli & Shahnaz Hamid, 1999. "Concerns of Food Security, Role of Gender and Intra-household Dynamics in Pakistan," PIDE Research Report 1999:3, Pakistan Institute of Development Economics.
    7. Aeggarchat Sirisankanan, 2017. "Household Risks and Household Human Capital Investment: Longitudinal Evidence from Thailand," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 29(2), pages 493-511, April.
    8. Saqib Jafarey & Ram Mainali & Gabriel Montes‐Rojas, 2020. "Age at marriage, social norms, and female education in Nepal," Review of Development Economics, Wiley Blackwell, vol. 24(3), pages 878-909, August.
    9. Zafar Mueen Nasir, 2002. "Returns to Human Capital in Pakistan: A Gender Disaggregated Analysis," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 41(1), pages 1-28.
    10. Sawada, Yasuyuki & Lokshin, Michael, 2009. "Obstacles to school progression in rural Pakistan: An analysis of gender and sibling rivalry using field survey data," Journal of Development Economics, Elsevier, vol. 88(2), pages 335-347, March.
    11. Yasuyuki Sawada, 2003. "Income Risks, Gender, and Human Capital Investment in a Developing Country," CIRJE F-Series CIRJE-F-198, CIRJE, Faculty of Economics, University of Tokyo.

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