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The External Effect of Urban Schooling Attainment on Workers’ Incomes in Ecuador

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  • Theodore R. Breton
  • Juan Pablo Jaramillo

Abstract

We estimate the direct and external effects of levels of schooling on personal income in Ecuador in 2011, using data for 69,653 individuals in 567 municipalities. Using a Mincerian model that includes municipal levels of schooling and the size of the municipality and controls for endogeneity, we find that each year of individual schooling raises individual income by 8.5 percent and each year of municipal schooling raises individual income by 2.2 percent. The external effect of an additional year of schooling is larger for workers with more schooling, for those with higher incomes, and for those in more educated municipalities.

Suggested Citation

  • Theodore R. Breton & Juan Pablo Jaramillo, 2014. "The External Effect of Urban Schooling Attainment on Workers’ Incomes in Ecuador," Documentos de Trabajo CIEF 012436, Universidad EAFIT.
  • Handle: RePEc:col:000122:012436
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    References listed on IDEAS

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    1. Moretti, Enrico, 2004. "Estimating the social return to higher education: evidence from longitudinal and repeated cross-sectional data," Journal of Econometrics, Elsevier, vol. 121(1-2), pages 175-212.
    2. George Psacharopoulos & Harry Anthony Patrinos, 2004. "Returns to investment in education: a further update," Education Economics, Taylor & Francis Journals, vol. 12(2), pages 111-134.
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    More about this item

    Keywords

    Ecuador; Schooling; External Effects; Regional Economics; Human Capital;
    All these keywords.

    JEL classification:

    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • O - Economic Development, Innovation, Technological Change, and Growth

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