Return to schooling in Vietnam during economic transition: Does the return reach its peak?
A common phenomenon about transition economies is that the return to schooling improves as economic reform progresses. Existing research suggests that Vietnam is not an exception to the pattern. However, the rate of return for the period 1992-1998 is still relatively low, below 5%, relative to that of the world and other transitional economies. In addition, it is hard to see a clear trend in the current literature due to different methods applied and sets of variables controlled in the earnings equations (see Appendix B). The low returns may result from the gradual economic reforms applied in Vietnam, whilst in Eastern European countries the “Big Bang” transformation was conducted. Therefore, to test whether the return to schooling in Vietnam is rising and reaches other transitional economies’ rate of returns, we re-examine the trend in the rate of return to schooling in Vietnam over the 1998-2008 period, when the reforms have had a longer time to have an effect. We apply the OLS and Heckman selection estimator (Maximum Likelihood approach) and find that the return has increased quickly during the later economic reform but its pace has slowed down when the return reached the global average rate of returns around 10%.
|Date of creation:||2010|
|Date of revision:||19 Oct 2010|
|Contact details of provider:|| Postal: |
Web page: http://mpra.ub.uni-muenchen.de
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Robert S. Chase, 1998. "Markets for communist human capital: Returns to education and experience in the Czech republic and Slovakia," Industrial and Labor Relations Review, ILR Review, Cornell University, ILR School, vol. 51(3), pages 401-423, April.
- Psacharopoulos, George & Patrinos, Harry Anthony, 2002.
"Returns to investment in education : a further update,"
Policy Research Working Paper Series
2881, The World Bank.
- 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.
- Orazem, Peter F. & Vodopivec, Milan, 1994.
"Winners and losers in transition : returns to education, experience, and gender in Slovenia,"
Policy Research Working Paper Series
1342, The World Bank.
- Orazem, Peter F & Vodopivec, Milan, 1995. "Winners and Losers in Transition: Returns to Education, Experience, and Gender in Slovenia," World Bank Economic Review, World Bank Group, vol. 9(2), pages 201-30, May.
- Orazem, Peter & Vodopivec, Milan, 1995. "Winners and Losers in Transition: Returns to Education, Experience, and Gender in Slovenia," Staff General Research Papers 5270, Iowa State University, Department of Economics.
- Heckman, James J, 1979.
"Sample Selection Bias as a Specification Error,"
Econometric Society, vol. 47(1), pages 153-61, January.
- Belton M. Fleisher & Klara Sabirianova Peter & Xiaojun Wang, 2004.
"Returns to Skills and the Speed of Reforms: Evidence from Central and Eastern Europe, China, and Russia,"
William Davidson Institute Working Papers Series
2004-703, William Davidson Institute at the University of Michigan.
- Fleisher, Belton M. & Sabirianova, Klara & Wang, Xiaojun, 2005. "Returns to skills and the speed of reforms: Evidence from Central and Eastern Europe, China, and Russia," Journal of Comparative Economics, Elsevier, vol. 33(2), pages 351-370, June.
- Fleisher, Belton M. & Peter, Klara Sabirianova & Wang, Xiaojun, 2004. "Returns to Skills and the Speed of Reforms: Evidence from Central and Eastern Europe, China, and Russia," IZA Discussion Papers 1182, Institute for the Study of Labor (IZA).
- Moock, Peter R. & Patrinos, Harry Anthony & Venkataraman, Meera, 2003. "Education and earnings in a transition economy: the case of Vietnam," Economics of Education Review, Elsevier, vol. 22(5), pages 503-510, October.
- Brainerd, Elizabeth, 1998. "Winners and Losers in Russia's Economic Transition," American Economic Review, American Economic Association, vol. 88(5), pages 1094-1116, December.
When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:24984. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ekkehart Schlicht)
If references are entirely missing, you can add them using this form.