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Earnings and education in Latin America : assessing priorities for schooling investments

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  • Psacharopoulos, George
  • Ying Chu Ng

Abstract

The authors use household survey data for 18 Latin American countries to assess earnings differentials by level of education, and to assess how these differentials changed in the 1980s. Introducing the cost of education allows them to estimate private and social rates of return on investments on education across several dimensions: by gender, by level of education, by sector of employment, by nature of the secondary school curriculum, and over time. The results show that, in most countries, the earnings premium received by graduates of higher education decreased in the 1980s. Investment in primary education shows the highest rate of return among all levels considered - and is still the number one investment priority in most countries.

Suggested Citation

  • Psacharopoulos, George & Ying Chu Ng, 1992. "Earnings and education in Latin America : assessing priorities for schooling investments," Policy Research Working Paper Series 1056, The World Bank.
    • Handle: RePEc:wbk:wbrwps:1056
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Crouch, Luis A., 1996. "Public education equity and efficiency in South Africa: Lessons for other countries," Economics of Education Review, Elsevier, vol. 15(2), pages 125-137, April.
    2. Bedi, Arjun S. & Gaston, Noel, 1999. "Using variation in schooling availability to estimate educational returns for Honduras," Economics of Education Review, Elsevier, vol. 18(1), pages 107-116, February.
    3. Weller, Jürgen, 2000. "Employment trends in Latin America and the Caribbean during the 1990s," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    4. Montobbio, Fabio & Rampa, Francesco, 2005. "The impact of technology and structural change on export performance in nine developing countries," World Development, Elsevier, vol. 33(4), pages 527-547, April.
    5. Funkhouser, Edward, 1998. "Changes in the returns to education in Costa Rica," Journal of Development Economics, Elsevier, vol. 57(2), pages 289-317.
    6. Lederman, Daniel & Rojas, Diego, 2014. "Export shocks and the volatility of returns to schooling : evidence from twelve Latin American economies," Policy Research Working Paper Series 7144, The World Bank.
    7. Alejos, Luis Alejandro, 2006. "La elección del sector laboral y los retornos a la educación en Guatemala [Labour Sector Choice and the Returns to Education in Guatemala]," MPRA Paper 42756, University Library of Munich, Germany.
    8. Paul Bennell, 1996. "Privatization, choice and competition: The World Bank's reform agenda for vocational education and training in sub-Saharan Africa," Journal of International Development, John Wiley & Sons, Ltd., vol. 8(3), pages 467-487.
    9. Ruth A. Judson, "undated". "Do Low Human Capital Coefficients Make Sense? A Puzzle and Some Answers," Finance and Economics Discussion Series 1996-13, Board of Governors of the Federal Reserve System (U.S.), revised 04 Dec 2019.
    10. Ruth A. Judson, 1996. "Do low human capital coefficients make sense? A puzzle and some answers," Finance and Economics Discussion Series 96-13, Board of Governors of the Federal Reserve System (U.S.).
    11. Paul Bennell, 1996. "General versus vocational secondary education in developing countries: A review of the rates of return evidence," Journal of Development Studies, Taylor & Francis Journals, vol. 33(2), pages 230-247.
    12. Lachler, Ulrich, 1998. "Education and earnings inequality in Mexico," Policy Research Working Paper Series 1949, The World Bank.
    13. Gustavo Adolfo Hernández, 2011. "¿Cuán rentable es la educación superior en Colombia?," Revista Lecturas de Economía, Universidad de Antioquia, CIE.
    14. W.F. Maloney & D. Lederman & J. Messina, 2011. "The Fall of Wage Flexibility," World Bank Publications - Reports 23575, The World Bank Group.
    15. Arjun Bedi & Noel Gaston, 1997. "Returns to endogenous education: the case of Honduras," Applied Economics, Taylor & Francis Journals, vol. 29(4), pages 519-528.
    16. World Bank, 2004. "Poverty in Guatemala," World Bank Publications - Books, The World Bank Group, number 15066, April.
    17. Funkhouser, Edward, 1998. "The importance of firm wage differentials in explaining hourly earnings variation in the large-scale sector of Guatemala," Journal of Development Economics, Elsevier, vol. 55(1), pages 115-131, February.

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