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Ethnicity, education, and earnings in Bolivia and Guatemala


  • Psacharopoulos, George


Indigenous groups are often associated with poverty and so are low levels of education. Guatemala and Bolivia are the two Latin American countries in which the ethnic part of the population is proportionately greatest, with Bolivia being more schooled than Guatemala. So the author tried to determine how levels of ethnicity and education affect the level of worker earnings. His investigation was based on data from household surveys in the two countries. He found that, other things being equal, indigenous people who acquire more human capital enjoy greater economic rewards than those who acquire less. Just giving ethnic groups basic education is bound to improve their position. This finding was supported by both within country and cross-country evidence: indigenous people fare better in Bolivia (where there is more education) than in Guatemala (where there is less). One possible (although controversial) intervention is to provide schooling in the child's first language. Such an intervention has been successfully implemented on a small scale in Guatemala. Bilingual programs also exist, on a small scale, in Bolivia.

Suggested Citation

  • Psacharopoulos, George, 1992. "Ethnicity, education, and earnings in Bolivia and Guatemala," Policy Research Working Paper Series 1014, The World Bank.
  • Handle: RePEc:wbk:wbrwps:1014

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    References listed on IDEAS

    1. Sumner, Daniel A, 1981. "Wage Functions and Occupational Selection in a Rural Less Developed Country Setting," The Review of Economics and Statistics, MIT Press, vol. 63(4), pages 513-519, November.
    2. Psacharopoulos, George, 1989. "Time trends of the returns to education: Cross-national evidence," Economics of Education Review, Elsevier, vol. 8(3), pages 225-231, June.
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    Cited by:

    1. Juan Pablo Atal & Hugo R. Ñopo & Natalia Winder, 2009. "New Century, Old Disparities: Gender and Ethnic Wage Gaps in Latin America," IDB Publications (Working Papers) 1131, Inter-American Development Bank.
    2. Oscar Molina Tejerina & Sergio Bobka Calcina, 2016. "Comercio internacional y brechas salariales no explicadas por género: Evidencia para el sector agrícola en Bolivia," Investigación & Desarrollo 0416, Universidad Privada Boliviana, revised Jun 2016.
    3. Mark Gradstein & Maurice Schiff, 2006. "The political economy of social exclusion, with implications for immigration policy," Journal of Population Economics, Springer;European Society for Population Economics, vol. 19(2), pages 327-344, June.
    4. repec:aru:wpaper:200601 is not listed on IDEAS
    5. Quiñones, Esteban J., 2006. "The Indigenous Heterogeneity of Oportunidades: Ample or Insufficient Human Capital Accumulation?," MPRA Paper 19539, University Library of Munich, Germany.
    6. Yanez-Pagans, Monica, 2008. "Culture and Human Capital Investments: Evidence of an Unconditional Cash Transfer Program in Bolivia," IZA Discussion Papers 3678, Institute for the Study of Labor (IZA).
    7. Gabriela Inchauste, 2001. "Intrahousehold Allocation of Resources; The Bolivian Family," IMF Working Papers 01/57, International Monetary Fund.


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