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Education externalities in rural Ethiopia: evidence from average and stochastic frontier production functions

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  • Sharada Weir
  • John Knight

Abstract

Education will have externality effects in agriculture if, in the course of conducting their own private economic activities, educated farmers raise the productivity of uneducated farmers with whom they come into contact. This paper seeks to determine the potential size and source of such benefits for rural areas of Ethiopia. Average and stochastic frontier production function methodologies are employed to measure productivity and efficiency of farmers. In each case, internal and external returns to schooling are compared. We find that there are substantial and significant externality benefits of education in terms of higher average farm output and a shifting outwards of the production frontier. External benefits of schooling may be several times as high as internal benefits in this regard. However, we are unable to find any evidence of externality benefits to schooling in terms of improvements in technological efficiency in the use of a given technology. This suggests that the source of externalities to schooling is in the adoption and spread of innovations, which shift out the production frontier.

Suggested Citation

  • Sharada Weir & John Knight, 2000. "Education externalities in rural Ethiopia: evidence from average and stochastic frontier production functions," CSAE Working Paper Series 2000-04, Centre for the Study of African Economies, University of Oxford.
  • Handle: RePEc:csa:wpaper:2000-04
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    File URL: http://www.csae.ox.ac.uk/materials/papers/20-04text.pdf
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    References listed on IDEAS

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    1. Lockheed, Marlaine E & Jamison, Dean T & Lau, Lawrence J, 1987. "Farmer Education and Farm Efficiency: Reply," Economic Development and Cultural Change, University of Chicago Press, vol. 35(3), pages 643-644, April.
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    5. Abay, Afaw & Assefa, Admassie, 1996. "The Impact of education on A locative and Technical Efficiency of Farmers: The Case of Ethiopian Small Holders," Ethiopian Journal of Economics, Ethiopian Economics Association, vol. 5(1).
    6. Battese, George E. & Coelli, Tim J., 1988. "Prediction of firm-level technical efficiencies with a generalized frontier production function and panel data," Journal of Econometrics, Elsevier, vol. 38(3), pages 387-399, July.
    7. MaCurdy, Thomas E & Pencavel, John H, 1986. "Testing between Competing Models of Wage and Employment Determination in Unionized Markets," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 3-39, June.
    8. Sharada Weir, 1999. "The effects of education on farmer productivity in rural Ethiopia," CSAE Working Paper Series 1999-07, Centre for the Study of African Economies, University of Oxford.
    9. Sharada Weir & John Knight, 2000. "Adoption and diffusion of agricultural innovations in Ethiopia: the role of Education," CSAE Working Paper Series 2000-05, Centre for the Study of African Economies, University of Oxford.
    10. Croppenstedt, Andre & Muller, Christophe, 2000. "The Impact of Farmers' Health and Nutritional Status on Their Productivity and Efficiency: Evidence from Ethiopia," Economic Development and Cultural Change, University of Chicago Press, vol. 48(3), pages 475-502, April.
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    Cited by:

    1. Tchale, Hardwick & Sauer, Johannes, 2007. "The efficiency of maize farming in Malawi. A bootstrapped translog frontier," Cahiers d'Economie et de Sociologie Rurales (CESR), INRA (French National Institute for Agricultural Research), vol. 82.
    2. Sharada Weir, 2000. "Intergenerational transfers of human capital: evidence on two types of education externalities," CSAE Working Paper Series 2000-15, Centre for the Study of African Economies, University of Oxford.
    3. Tassew, Woldehanna, 2001. "The Role Schooling in the Choice of Activities and Alleviation of Poverty in Rural Ethiopia," Ethiopian Journal of Economics, Ethiopian Economics Association, vol. 10(1).
    4. Regmi, Madhav & Oladipo, Obembe & Jason, Bergtold, 2016. "Efficiency Evaluation Of Rice Production In Bangladesh," 2016 Annual Meeting, February 6-9, 2016, San Antonio, Texas 229990, Southern Agricultural Economics Association.
    5. Christian K.M. Kingombe, 2012. "The Linkage between Outcome Differences in Cotton Production and Rural Roads Improvements - A Matching Approach," IHEID Working Papers 12-2012, Economics Section, The Graduate Institute of International Studies.
    6. Ogundari, Kolawole, 2014. "The Paradigm of Agricultural Efficiency and its Implication on Food Security in Africa: What Does Meta-analysis Reveal?," World Development, Elsevier, vol. 64(C), pages 690-702.
    7. Wobst, Peter & Arndt, Channing, 2004. "HIV/AIDS and Labor Force Upgrading in Tanzania," World Development, Elsevier, vol. 32(11), pages 1831-1847, November.
    8. Salau, S.A., 2013. "Cropping Intensification and Technical Inefficiency of Maize-Based Farming Households in Southern-Guinea Savanna (SGS) of Nigeria," 2013 AAAE Fourth International Conference, September 22-25, 2013, Hammamet, Tunisia 161643, African Association of Agricultural Economists (AAAE).
    9. John Cockburn, 2002. "Income Contributions of Child Work in Rural Ethiopia," CSAE Working Paper Series 2002-12, Centre for the Study of African Economies, University of Oxford.
    10. Tchale, Hardwick & Sauer, Johannes, 2008. "Soil Fertility Management And Maize Productivity In Malawi: Curvature Correct Efficiency Modeling And Simulation," 2007 Second International Conference, August 20-22, 2007, Accra, Ghana 52077, African Association of Agricultural Economists (AAAE).
    11. Weir, Sharada & Knight, John, 2004. "Externality Effects of Education: Dynamics of the Adoption and Diffusion of an Innovation in Rural Ethiopia," Economic Development and Cultural Change, University of Chicago Press, vol. 53(1), pages 93-113, October.
    12. Oleg Badunenko & Daniel Henderson & Romain Houssa, 2014. "Significant drivers of growth in Africa," Journal of Productivity Analysis, Springer, vol. 42(3), pages 339-354, December.
    13. Hardwick Tchale & Johannes Sauer, 2007. "The efficiency of maize farming in Malawi. A bootstrapped translog frontier," Post-Print hal-01201145, HAL.
    14. Wambugu, Anthony, 2002. "Real Wages and Returns to Human Capital in Kenya Manufacturing firms," Working Papers in Economics 75, University of Gothenburg, Department of Economics.
    15. Ogundari, Kolawole, 2009. "A Meta-Analysis Of Technical Efficiency In Nigerian Agriculture," 2009 Conference, August 16-22, 2009, Beijing, China 50327, International Association of Agricultural Economists.
    16. Ahsanuzzaman, Ahsanuzzaman, 2015. "Duration Analysis of Technology Adoption in Bangladeshi Agriculture," 2015 AAEA & WAEA Joint Annual Meeting, July 26-28, San Francisco, California 200406, Agricultural and Applied Economics Association;Western Agricultural Economics Association.
    17. Wobst, Peter & Arndt, Channing, 2003. "HIV/AIDS and Primary School Performance in Tanzania," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25870, International Association of Agricultural Economists.
    18. Hardwick Tchale & Johannes Sauer, 2007. "The efficiency of maize farming in Malawi. A bootstrapped translog frontier," Cahiers d'Economie et Sociologie Rurales, INRA Department of Economics, vol. 82, pages 33-56.
    19. Jones, Michael S. & Rejesus, Roderick M. & Brown, Zachary S. & Yorobe, Jose M., 2017. "Do farmers with less education realize higher yield gains from GM maize in developing countries? Evidence from the Philippines," 2017 Annual Meeting, February 4-7, 2017, Mobile, Alabama 252822, Southern Agricultural Economics Association.
    20. Binam, Joachim Nyemeck & Tonye, Jean & wandji, Njankoua & Nyambi, Gwendoline & Akoa, Mireille, 2004. "Factors affecting the technical efficiency among smallholder farmers in the slash and burn agriculture zone of Cameroon," Food Policy, Elsevier, vol. 29(5), pages 531-545, October.

    More about this item

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • I2 - Health, Education, and Welfare - - Education
    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

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