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Wage Rentals for Reproducible Human Capital: Evidence from Ghana and the Ivory Coast


  • T. Paul Schultz

    () (Yale University, Economic Growth Center)


Education, child nutrition, adult health/nutrition, and labor mobility are critical factors in achieving recent sustained growth in factor productivity. To compare the contribution of these four human capital inputs, an expanded specification of the wage function is estimated from household (LSMS) surveys of the Ivory Coast and Ghana. Specification tests assess whether the human capital inputs are exogenous, and instrumental variable techniques are used to estimate the wage function. Smaller panels from the Ivory Coast imply the magnitude of measurement error in the human capital inputs and provide more efficient instruments to estimate the wage equation. The conclusion emerges that weight-for-height and height are endogenous, particularly prone to measurement error, and heterogeneous in their effects on wages. Overall returns to these four forms of human capital are similar within each country for men and women, but education and migration returns are higher in the more rapidly growing Ivory Coast, and the wage effects of child nutrition proxied by height are greater in poorer, more malnourished Ghana.

Suggested Citation

  • T. Paul Schultz, 2004. "Wage Rentals for Reproducible Human Capital: Evidence from Ghana and the Ivory Coast," Yale School of Management Working Papers ysm420, Yale School of Management.
  • Handle: RePEc:ysm:somwrk:ysm420

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    References listed on IDEAS

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    Cited by:

    1. Jere R. Behrman & John Hoddinott & John A. Maluccio & Reynaldo Martorell, 2009. "Brains versus Brawn: Labor Market Returns to Intellectual and Health Human Capital in a Poor Developing Country," Middlebury College Working Paper Series 0907, Middlebury College, Department of Economics.
    2. Maluccio, John A., 1998. "Endogeneity of schooling in the wage function," FCND discussion papers 54, International Food Policy Research Institute (IFPRI).
    3. Wenshu Gao & Russell Smyth, 2010. "Health Human Capital, Height and Wages in China," Journal of Development Studies, Taylor & Francis Journals, vol. 46(3), pages 466-484.
    4. Schultz, T. Paul, 2010. "Population and Health Policies," Handbook of Development Economics, Elsevier.
    5. Sohn, Kitae, 2015. "The height premium in Indonesia," Economics & Human Biology, Elsevier, vol. 16(C), pages 1-15.
    6. Tao, Hung-Lin, 2014. "Height, weight, and entry earnings of female graduates in Taiwan," Economics & Human Biology, Elsevier, vol. 13(C), pages 85-98.
    7. Komlos, John, 2009. "How useful is anthropometric history?," Discussion Papers in Economics 10587, University of Munich, Department of Economics.
    8. T. Paul Schultz, 2003. "Human Capital, Schooling and Health Returns," Working Papers 853, Economic Growth Center, Yale University.
    9. repec:eee:ehbiol:v:26:y:2017:i:c:p:13-20 is not listed on IDEAS
    10. Dinda, Soumyananda & Gangopadhyay, P.K. & Chattopadhyay, B.P. & Saiyed, H.N. & Pal, M. & Bharati, P., 2006. "Height, weight and earnings among coalminers in India," Economics & Human Biology, Elsevier, vol. 4(3), pages 342-350, December.
    11. Atheendar S. Venkataramani & K.R. Shanmugam & Jennifer Prah Ruger, 2010. "Health, Technical Efficiency, And Agricultural Production In Indian Districts," Journal of Economic Development, Chung-Ang Unviersity, Department of Economics, vol. 35(4), pages 1-23, December.
    12. Godoy, Ricardo & Magvanjav, Oyunbileg & Nyberg, Colleen & Eisenberg, Dan T.A. & McDade, Thomas W. & Leonard, William R. & Reyes-García, Victoria & Huanca, Tomás & Tanner, Susan & Gravlee, Clarence, 2010. "Why no adult stunting penalty or height premium?: Estimates from native Amazonians in Bolivia," Economics & Human Biology, Elsevier, vol. 8(1), pages 88-99, March.
    13. Pierre LEVASSEUR, 2016. "The effects of bodyweight on wages in urban Mexico," Cahiers du GREThA 2016-18, Groupe de Recherche en Economie Théorique et Appliquée.
    14. Cawley, John & Han, Euna & Norton, Edward C., 2009. "Obesity and labor market outcomes among legal immigrants to the United States from developing countries," Economics & Human Biology, Elsevier, vol. 7(2), pages 153-164, July.
    15. Juliet Elu & Gregory Price, 2013. "Ethnicity as a Barrier to Childhood and Adolescent Health Capital in Tanzania: Evidence from the Wage-Height Relationship," African Development Review, African Development Bank, vol. 25(1), pages 1-13.
    16. Levasseur, Pierre, 2017. "The ambiguous causal relationship between body-mass and labour income in emerging economies: The case of Mexico," MPRA Paper 81933, University Library of Munich, Germany.
    17. T. Paul Schultz, 2005. "Productive Benefits of Health: Evidence from Low-Income Countries," Working Papers 903, Economic Growth Center, Yale University.
    18. de Oliveira, Victor Hugo & Quintana-Domeque, Climent, 2014. "Early-life environment and adult stature in Brazil: An analysis for cohorts born between 1950 and 1980," Economics & Human Biology, Elsevier, vol. 15(C), pages 67-80.
    19. Grimm, M., 2010. "Does inequality in health impede growth?," ISS Working Papers - General Series 19426, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    20. Colchero, M. Arantxa & Bishai, David, 2012. "Weight and earnings among childbearing women in Metropolitan Cebu, Philippines (1983–2002)," Economics & Human Biology, Elsevier, vol. 10(3), pages 256-263.
    21. Akachi, Yoko & Canning, David, 2010. "Health trends in Sub-Saharan Africa: Conflicting evidence from infant mortality rates and adult heights," Economics & Human Biology, Elsevier, vol. 8(2), pages 273-288, July.

    More about this item


    Endogenous Human Capital Returns; Health; Migration; Schooling; Africa; Physical Stature;

    JEL classification:

    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • 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
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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