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Returns to Computer Use in Bangladesh: An Econometric Analysis

Author

Listed:
  • Fahmida Khatun

    (Centre for Policy Dialogue (CPD))

  • Syed Yusuf Saadat

    (Centre for Policy Dialogue (CPD))

Abstract

In the highly competitive labour market of Bangladesh, workers are unable to find the right jobs and employers are also unable to find the right workers. Such skills mismatch is a manifestation that education alone cannot bridge the gaps in the labour market. Computer skills, which can complement education, are becoming increasingly important. Nevertheless, there is a dearth of research regarding the potential benefit of possessing computer skills in the labour market of Bangladesh. This paper intends to fill in this knowledge gap by estimating the returns to computer use using a national labour force survey dataset. By utilising Heckman’s two-step selection model, it was found that workers who could use computers earned 17% more than workers who could not use computers. Additionally, the returns to education and experience were estimated to be 3% and 2%, respectively. This implies that computer skills were as valuable as 5 years of education or 8 years of experience, assuming that the returns to all three were constant over time. The results of this study provide empirical evidence in favor of allocating government resources for computer training, and also advocate for individual investment towards learning computer skills.

Suggested Citation

  • Fahmida Khatun & Syed Yusuf Saadat, 2021. "Returns to Computer Use in Bangladesh: An Econometric Analysis," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 64(1), pages 175-198, March.
    • Handle: RePEc:spr:ijlaec:v:64:y:2021:i:1:d:10.1007_s41027-021-00304-2
    DOI: 10.1007/s41027-021-00304-2
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    Cited by:

    1. Muhammed Refeque & P. Azad, 2022. "How do linguistic and technical skills affect earnings in India?," Indian Economic Review, Springer, vol. 57(1), pages 23-57, June.

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    More about this item

    Keywords

    Education; Skills; Computers; Bangladesh;
    All these keywords.

    JEL classification:

    • I23 - Health, Education, and Welfare - - Education - - - Higher Education; Research Institutions
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I26 - Health, Education, and Welfare - - Education - - - Returns to Education
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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