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Family Background, Education and Earnings in Kenya

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  • Wambugu, Anthony

    (Department of Economics, School of Economics and Commercial Law, Göteborg University)

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    Abstract

    This paper uses data collected in 2000 to first estimate OLS and ordered probit models to measure correlation between family background and workers’ education. Then, human capital earnings functions are estimated to examine to what extent family background accounts for observed correlation between workers’ education and earnings. Subsequently, it estimates returns to education with education treated as endogenous. Having well-educated parents is associated with greater educational attainment and earnings. Returns to education decline slightly when parents’ education controls are in the earnings function. Instrumental variable estimation or self-selection correction suggests that estimates of returns to education may be larger than conventional estimates suggest.

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    File URL: http://hdl.handle.net/2077/2852
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    Paper provided by University of Gothenburg, Department of Economics in its series Working Papers in Economics with number 76.

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    Length: 30 pages
    Date of creation: 20 Jun 2002
    Date of revision:
    Handle: RePEc:hhs:gunwpe:0076
    Contact details of provider: Postal: Department of Economics, School of Business, Economics and Law, University of Gothenburg, Box 640, SE 405 30 GÖTEBORG, Sweden
    Phone: 031-773 10 00
    Web page: http://www.handels.gu.se/econ/

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    Keywords: Earnings function; return to education; instrumental variables;

    Find related papers by JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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