IDEAS home Printed from https://ideas.repec.org/p/ude/wpaper/0410.html
   My bibliography  Save this paper

Can Education Policy Address the Wage Gap? A Note on Public Skill Formation in Developing Countries

Author

Listed:
  • Rossana Patron

    (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)

  • Marcel Vaillant

    (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)

Abstract

The potential distributional effects of public education as a producer of endowments are discussed, taking into consideration the presence of systemic inefficiency in the sector, which is typical in developing economies. The analysis has implications for policymakers, as it suggests the following: a) not addressing the inefficiency in educational systems has a cost in terms of wage inequality, and b) the effects of trade may be mediated or even reversed by the orientation of the education policy.

Suggested Citation

  • Rossana Patron & Marcel Vaillant, 2010. "Can Education Policy Address the Wage Gap? A Note on Public Skill Formation in Developing Countries," Documentos de Trabajo (working papers) 0410, Department of Economics - dECON.
  • Handle: RePEc:ude:wpaper:0410
    as

    Download full text from publisher

    File URL: https://hdl.handle.net/20.500.12008/2156
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Turrini, Alessandro, 1998. "Endogenous education policy and increasing income inequality between skilled and unskilled workers," European Journal of Political Economy, Elsevier, vol. 14(2), pages 303-326, May.
    2. Jorge Saba Arbache & Andy Dickerson & Francis Green, 2004. "Trade Liberalisation and Wages in Developing Countries," Economic Journal, Royal Economic Society, vol. 114(493), pages 73-96, February.
    3. Weshah A. Razzak & Jason C. Timmins, 2008. "A Macroeconomic Perspective On Skill Shortages And The Skill Premium In New Zealand," Australian Economic Papers, Wiley Blackwell, vol. 47(1), pages 74-91, March.
    4. Lisandro Abrego & John Whalley, 2003. "Goods market responses to trade shocks and trade and wages decompositions," Canadian Journal of Economics, Canadian Economics Association, vol. 36(3), pages 747-757, August.
    5. Sanchez-Paramo, Carolina & Schady, Norbert, 2003. "Off and running? Technology, trade and the rising demand for skilled workers in Latin America," Policy Research Working Paper Series 3015, The World Bank.
    6. Bas Jacobs, 2004. "The Lost Race between Schooling and Technology," De Economist, Springer, vol. 152(1), pages 47-78, March.
    7. Barro, Robert J & Lee, Jong-Wha, 2001. "International Data on Educational Attainment: Updates and Implications," Oxford Economic Papers, Oxford University Press, vol. 53(3), pages 541-563, July.
    8. Kiley, Michael T, 1999. "The Supply of Skilled Labour and Skill-Biased Technological Progress," Economic Journal, Royal Economic Society, vol. 109(458), pages 708-724, October.
    9. Lisandro Abrego & John Whalley, 2003. "Goods market responses to trade shocks and trade and wages decompositions," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 36(3), pages 747-757, August.
    10. Ross, D. & Sabot, R. & Birdsall, N., 1995. "Inequality and Growth Reconsidered," Center for Development Economics 142, Department of Economics, Williams College.
    11. Birdsall, Nancy & Ross, David & Sabot, Richard, 1995. "Inequality and Growth Reconsidered: Lessons from East Asia," The World Bank Economic Review, World Bank, vol. 9(3), pages 477-508, September.
    12. Menezes-Filho, Naercio & Scorzafave, Luiz, 2009. "Employment and Inequality of Outcomes in Brazil," Insper Working Papers wpe_200, Insper Working Paper, Insper Instituto de Ensino e Pesquisa.
    13. Mamoon, Dawood & Murshed, S. Mansoob, 2008. "Unequal skill premiums and trade liberalization: Is education the missing link?," Economics Letters, Elsevier, vol. 100(2), pages 262-266, August.
    14. Daron Acemoglu, 2003. "Patterns of Skill Premia," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 70(2), pages 199-230.
    15. Antonio Avalos & Andreas Savvides, 2006. "The Manufacturing Wage Inequality in Latin America and East Asia: Openness, Technology Transfer, and Labor Supply," Review of Development Economics, Wiley Blackwell, vol. 10(4), pages 553-576, November.
    16. Pinelopi K. Goldberg & Nina Pavcnik, 2004. "Trade, Inequality, and Poverty: What Do We Know? Evidence from Recent Trade Liberalization Episodes in Developing Countries," NBER Working Papers 10593, National Bureau of Economic Research, Inc.
    17. Hanushek, Eric A. & Leung, Charles Ka Yui & Yilmaz, Kuzey, 2003. "Redistribution through education and other transfer mechanisms," Journal of Monetary Economics, Elsevier, vol. 50(8), pages 1719-1750, November.
    18. Eric A. Hanushek, 1979. "Conceptual and Empirical Issues in the Estimation of Educational Production Functions," Journal of Human Resources, University of Wisconsin Press, vol. 14(3), pages 351-388.
    19. Paul R. Krugman, 2008. "Trade and Wages, Reconsidered," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 39(1 (Spring), pages 103-154.
    20. Atolia, Manoj, 2007. "Trade liberalization and rising wage inequality in Latin America: Reconciliation with HOS theory," Journal of International Economics, Elsevier, vol. 71(2), pages 467-494, April.
    21. Eckhard Janeba, 2000. "Trade, Income Inequality, and Government Policies: Redistribution of Income or Education Subsidies?," NBER Working Papers 7485, National Bureau of Economic Research, Inc.
    22. Heckman, James J. & Masterov, Dimitriy V., 2004. "Skill Policies for Scotland," IZA Discussion Papers 1444, Institute of Labor Economics (IZA).
    23. Rossana Patrón, 2008. "Early school dropouts in developing countries: An integer approach to guide intervention. The case of Uruguay," Documentos de Trabajo (working papers) 1608, Department of Economics - dECON.
    24. Jere R. Behrman & Nancy Birdsall & Miguel Székely, 2007. "Economic Policy Changes and Wage Differentials in Latin America," Economic Development and Cultural Change, University of Chicago Press, vol. 56(1), pages 57-97, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Víctor Giménez & Claudio Thieme & Diego Prior & Emili Tortosa-Ausina, 2019. "Comparing the Performance of National Educational Systems: Inequality Versus Achievement?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 141(2), pages 581-609, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Peter Howard-Jones & Jens Hölscher, 2020. "The Influence Of The Washington Consensus Programme On The Transitional Economies Of Eastern Europe – A Firm-Level Analysis," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 65(226), pages 9-44, July – Se.
    2. Harris, Richard G. & Robertson, Peter E., 2013. "Trade, wages and skill accumulation in the emerging giants," Journal of International Economics, Elsevier, vol. 89(2), pages 407-421.
    3. García Muñoz, Teresa María & Milgram Baleix, Juliette & Odeh, Omar Odeh, 2020. "Inequality in Latin America: The role of the nature of trade and partners," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 14, pages 1-35.
    4. Paolo Giordano & Kun Li, 2012. "An Updated Assessment of the Trade and Poverty Nexus in Latin America," IDB Publications (Working Papers) 79119, Inter-American Development Bank.
    5. Mamoon, Dawood, 2017. "Why International Trade Cause Inequality in Developing Countries," MPRA Paper 82268, University Library of Munich, Germany.
    6. Maurício Benegas & Márcio Veras Corrêa, 2020. "Educational supply policies: distortions and labor market performance," Journal of Economics, Springer, vol. 129(3), pages 203-239, April.
    7. Carlos Medina & Christian Posso, 2010. "Technical Change and Polarization of the Labor Market: Evidence for Brazil, Colombia and Mexico," Borradores de Economia 614, Banco de la Republica de Colombia.
    8. Jørn Rattsø & Hildegunn E. Stokke, 2013. "Trade, Skill Biased Technical Change and Wage Inequality in South Africa," Review of International Economics, Wiley Blackwell, vol. 21(3), pages 419-431, August.
    9. Julien Gourdon, 2011. "Wage inequality in developing countries: South–South trade matters," International Review of Economics, Springer;Happiness Economics and Interpersonal Relations (HEIRS), vol. 58(4), pages 359-383, December.
    10. Ricardo Fort, 2007. "Land inequality and economic growth: a dynamic panel data approach," Agricultural Economics, International Association of Agricultural Economists, vol. 37(2‐3), pages 159-165, September.
    11. Antonio Avalos & Andreas Savvides, 2006. "The Manufacturing Wage Inequality in Latin America and East Asia: Openness, Technology Transfer, and Labor Supply," Review of Development Economics, Wiley Blackwell, vol. 10(4), pages 553-576, November.
    12. Atolia, Manoj & Kurokawa, Yoshinori, 2016. "The impact of trade margins on the skill premium: Evidence from Mexico," Journal of Policy Modeling, Elsevier, vol. 38(5), pages 895-915.
    13. repec:ipg:wpaper:2014-504 is not listed on IDEAS
    14. Mr. Alberto Behar, 2013. "The Endogenous Skill Bias of Technical Change and Inequality in Developing Countries," IMF Working Papers 2013/050, International Monetary Fund.
    15. Edwards, T. Huw & Lücke, Matthias, 2021. "Decomposing the growth of the high-skilled wage premium in an advanced economy open to trade," The Quarterly Review of Economics and Finance, Elsevier, vol. 80(C), pages 766-784.
    16. Stephen Knowles, 2005. "Inequality and Economic Growth: The Empirical Relationship Reconsidered in the Light of Comparable Data," Journal of Development Studies, Taylor & Francis Journals, vol. 41(1), pages 135-159.
    17. Pinelopi Koujianou Goldberg & Nina Pavcnik, 2007. "Distributional Effects of Globalization in Developing Countries," Journal of Economic Literature, American Economic Association, vol. 45(1), pages 39-82, March.
    18. Bigsten, Arne & Durevall, Dick, 2004. "Trade Reform and Wage Inequality in Kenya, 1964-2000," Working Papers in Economics 148, University of Gothenburg, Department of Economics.
    19. Zouhair Mrabet, 2012. "The Impact of Trade Liberalization on Labor Market of Developing Countries: What can Literature tell us?," Journal of Economics and Behavioral Studies, AMH International, vol. 4(6), pages 307-318.
    20. Carlo Devillanova & Michele Maio & Pietro Vertova, 2010. "Labour mobility and the redistributive effects of trade integration," Journal of Economics, Springer, vol. 100(2), pages 95-115, June.
    21. Li, Muqun & Coxhead, Ian A., 2009. "Trade, Technology and Inequality in a Developing Country: Theory and Evidence from China," Staff Papers 92236, University of Wisconsin-Madison, Department of Agricultural and Applied Economics.

    More about this item

    Keywords

    public education; developing countries; wage gap;
    All these keywords.

    JEL classification:

    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ude:wpaper:0410. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Andrea Doneschi or the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/derauuy.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.