Publication: Returns to Education in Azerbaijan: Some New Estimates
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Published
2021-02-05
ISSN
1061-1991
Date
2021-06-24
Author(s)
Garcia Moreno, Vicente
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Abstract
This article estimates private and social returns to investment in education in Azerbaijan, using the 2015 Azerbaijan Monitoring Survey for Social Welfare. The private rate of return to education is 6 percent; this is the first estimate of returns to schooling in Azerbaijan since 1995. The returns to schooling are 6 percent for men and 8 percent for women, even controlling for selection. In addition, the article estimates the returns for higher education; for this level, the rate of return is 9 percent. Finally, using the full discount method, the private rate of return for tertiary education is 9 percent, and the social rate of return is 8 percent. One policy implication is to reexamine the funding of higher education and its expansion.
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Publication Returns to Education in Azerbaijan(World Bank, Washington, DC, 2020-01)This paper estimates private and social returns to investment in education in Azerbaijan, using the 2015 Azerbaijan Monitoring Survey for Social Welfare. The private rate of return to education is 6 percent; this is the first estimate of returns to schooling in Azerbaijan since 1995. The returns to schooling are 6 percent for men and 8 percent for women, even controlling for selection. In addition, the paper estimates the returns for higher education; for this level, the rate of return is 9 percent. Finally, using the full discount method, the private rate of return to tertiary education is 9 percent, and the social rate of return is 8 percent. One policy implication is to re-examine the funding of higher education and for its expansion.Publication Using the Oaxaca-Blinder Decomposition Technique to Analyze Learning Outcomes Changes over Time : An Application to Indonesia’s Results in PISA Mathematics(2011-03-01)The Oaxaca-Blinder technique was originally used in labor economics to decompose earnings gaps and to estimate the level of discrimination. It has been applied since in other social issues, including education, where it can be used to assess how much of a gap is due to differences in characteristics (explained variation) and how much is due to policy or system changes (unexplained variation). The authors apply the decomposition technique in an effort to analyze the increase in Indonesia's score in PISA mathematics. Between 2003 and 2006, Indonesia's score increased by 30 points, or 0.3 of a standard deviation. The test score increase is assessed in relation to family, student, school and institutional characteristics. The gap over time is decomposed into its constituent components based on the estimation of cognitive achievement production functions. The decomposition results suggest that almost the entire test score increase is explained by the returns to characteristics, mostly related to student age. However, the authors find that the adequate supply of teachers also plays a role in test score changes.Publication Institutional Effects as Determinants of Learning Outcomes : Exploring State Variations in Mexico(World Bank, Washington, DC, 2007-07)This paper uses the OECD's Program for International Student Assessment student-level achievement database for Mexico to estimate state education production functions, controlling for student characteristics, family background, home inputs, resources, and institutions. The authors take advantage of the state-level variation and representative sample to analyze the impact of institutional factors such as state accountability systems and the role of teachers' unions in student achievement. They argue that accountability, through increased use of state assessments, will improve learning outcomes. The authors also cast light on the role of teachers' unions, namely their strength through appointments to the school and relations with state governments. The analysis shows the importance of good relations between states and unions. Furthermore, it demonstrates that accountability systems are cost-effective measures for improving outcomes.Publication Heterogeneous Returns to Education in the Labor Market(World Bank, Washington, DC, 2012-08)Since the development of human capital theory, countless estimates of the economic benefits of investing in education for the individual have been published. While it is a universal fact that in all countries of the world the more education one has the higher his or her earnings, it is nevertheless important to know the empirical returns to schooling. However, simply knowing average returns is not useful in a world of heterogeneity. This paper finds increasing returns going from the lower to the higher end of the earnings distribution, but with some important differences across regions. The returns increase by quantile for Latin America. The returns decrease by quantile for most East Asian countries, producing an overall equalizing effect. India and Pakistan demonstrate opposite results. In Ghana, the returns across the distribution are flat, while for Kenya and Tanzania education is dis-equalizing.Publication Estimating the Returns to Education : Accounting for Heterogeneity in Ability(World Bank, Washington, DC, 2006-10)Typically estimates of the benefits of education investments show average private rates of return for the average individual. The average may not be useful for policy. An examination of the distribution of the returns across individuals is needed. The few studies that have examined these patterns focus on high-income countries, showing investments to be more profitable at the top of the income distribution. The implication is that investments may increase inequality. Extending the analysis to 16 East Asian and Latin American countries the authors observe mixed evidence in middle-income countries and decreasing returns in low-income countries. Such differences between countries could be due to more job mobility in industrial countries, scarcity of skills, or differential exposure to market forces.
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