Working Paper Series
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Abstract: Universal primary education and the elimination of gender gap in enrollment rates are two of the targets in the Millennium Development Goals (MDGs). Achieving these goals has been a high development priority for sub-Saharan African countries over the past decade. The challenges in this sector remain significant. Approximately 32% of primary school age children do not attend school and 34% of all youths do not attend secondary school in sub-Saharan Africa (UNESCO 2012). In addition, the adult literacy rate in Africa is 62%, which is far lower than the global average (84%). The ratio of female to male enrollment at secondary level is 79%. The reality in The Gambia is a microcosm of the situation in the region as a whole. While enrollment rates have risen recently in The Gambia, they have been historically low. Average net enrollment rates in the country between 1999 and 2007 for primary, middle and high school levels were on average 61%, 30% and 16% respectively. These low enrollment rates have persisted despite the high rate of returns to education in the country (Foltz and Gajigo 2012).
This paper estimates the schooling impact of a nation-wide scholarship program for female secondary school students. The program is funded jointly by the Gambian government, UNICEF, World Bank and the IMF (though the HIPC program) to help the country reach the MDG targets of reducing gender disparity in secondary school enrollment. In the regions where the scholarship program was implemented, all girls attending public (government-run) middle and high schools were exempted from paying school fees, which used to be mandatory. The program started in 2000 in few districts and then expanded across the country geographically (from east to west). This gradual expansion of the program in the initial implementation phases provides a unique opportunity to rigorously assess the causal impact of the scholarship program on educational outcomes. We use two nationally representative household surveys that were carried out in 1998 and 2002/03. In 1998, the program had not been implemented while in 2002, about half of the districts in the country had benefited from the project. This makes it possible to analyze the schooling impact of the program using difference-in-difference strategy – an impact evaluation strategy that is almost ideal to this setting.
The results show that the program had a significant enrollment effect on female students of all student-age groups. Specifically, the program led to approximately 8 to 9 percentage point enrollment increase in middle and high school female students. In addition, the enrollment effect of the program on girls at primary level is significantly positive (about 9 percentage points), suggesting that the removal of school fees caused households to further increase female primary school enrollment in anticipation of lower future costs. Years of schooling attained increased by 0.3 to 0.4 for female students. We found no significant schooling effect (enrollment and years of schooling attained) of the program on male students at any level (primary, middle or high school). The estimated results are robust to policy changes that occurred in the country during the period of the scholarship program implementation that could have affected student enrollment. For example, there was a significant expansion in school construction in parts of the country. This possibly confounding effect is addressed by controlling for the number of schools at the district level. This paper contributes to our understanding of the impact of abolishing school fees on enrollment and schooling attainment in Africa by providing precise estimates of the effects of user fee elimination for female students. This paper provides the first impact evaluation of enrollment of an almost nation-wide female scholarship program in Africa. More precise estimate of the impact of reducing schools is important for policy since it will enable governments to better assess the trade-offs involved in implementing similar policies.
Abstract: The importance of education in development is a perennial topic in economics especially in the context of sub-Saharan Africa’s development experience. The connection is not surprising since the region stands out both in its low level of schooling and its low average rate of economic growth. In the macroeconomic growth literature, evidence shows that education is positively associated with economic growth, a result that accords well with many previous studies. Micro-level research on private rates of returns to education has shown disparate estimates in sub-Saharan Africa in the private benefits to education. Our work focuses on private returns to education in The Gambia, a small country in West Africa with very low levels of schooling. Like other countries in the region, it also has achieved little economic growth since independence in 1965. It is therefore not surprising that the country is not on schedule to achieve one of the Millennium Development Goals: universal primary education by 2015.
This work adds to the large literature that provides a range of estimates on the private rate of returns to education in Africa. What has been found to date is that there is a great deal of heterogeneity in estimates of returns to education in Africa. It could be the case that there are indeed very large differences between countries in the rates of returns to education since there has been very little replication of estimates within a single country. However, part of the difference in estimates may also be due to the use of improved econometric techniques among recent papers. Some of these new approaches have addressed issues such as ability bias and selection - problems that were not always addressed in many earlier papers.
Another possibility is that differences in estimation strategies can also produce different results since the estimates may be specific to only a subset of the population in a given country. Specifically, the estimates from using an instrumental variable approach may not be comparable across different studies that employ different instruments since such an estimation strategy produces the local average treatment effects. Typical estimates using instrumental variables, in which the most common instrument measures access to schooling, provide measures of the returns to schooling for those who would have continued in school but did not have access to schooling. Given that in the African context there is great variation across countries, ethnic groups, religions, and the proclivity of parents to send their children to school even when it is available and affordable, one should also expect great variation in estimates of returns based on that population.
This work contributes to the literature by providing the first estimates of the private rate of returns to education for The Gambia and among its regions. Our estimates rely on the exploitation of the exogenous variations in the availability of schools across the country at the district level and its interaction with year of birth of individuals to control for ability bias. In addition, we use exogenous rainfall shocks to control for selection bias. Like many instrument variables, ours are not perfect. We discuss the possible violation of the exclusion restriction and provide further robustness checks to mitigate them. Our study uses three nationally representative household surveys from 1992, 1998 and 2003 that provide a very high coverage rate for the overall population of The Gambia. The results show high and significant private rate of returns to education for individuals in the wage sector. We estimate private rate of returns to education of 23% overall, using instrumental variable estimation. In addition, we found that returns were higher for men and urban residents. The results also demonstrate large significant differences in the rate of returns to education across regions, with poorer regions registering higher rate of returns. It is worth stressing that all sub-regions and sub-groups experience high rate of returns to education. What these finding suggests is that barriers to schooling in terms of both direct and indirect costs are substantial in The Gambia. Therefore, government policies should be geared towards lowering the cost of education in the country.
Abstract: Malawi’s educational system fairs poorly on a sub-regional scale. The gross enrolment rate is the lowest in the South African region. At the primary school level, pupil to teacher ratio stood at 80:1, repetition rates at 20 percent and the internal efficiency coefficient at 35 percent - all worse than the Sub-Saharan averages. Malawi ranked at the bottom of SACMEQ countries in English reading and math scores (SACMEQII, 2005). At 9 percent, the percentage of children reaching a minimum level of mastery in reading in English has halved over the 1998-2004 period. In Mathematics, 98 percent of the students do not possess skills beyond basic numeracy and none of them has skills beyond competent numeracy. Recent studies analyzing linkages between education, employment and earnings in Malawi employers find that graduates are more likely than others to find a job and that there is excess demand for skilled labour by the private sector [Jimat consultant (2008), Kadzamira (2003) and Pfeifer and Chiunda (2008)]. These studies find unemployment among secondary school graduates are low (8 percent in 2001 for graduates in 1990 and 1995), and close to zero among university graduates. Secondary school graduates are typically located in urban areas and are engaged in skilled wage employment. Of these, 70 percent are involved in wage employment, and 58 percent hold a professional and skilled non-manual job. The private sector is the main employer (69 percent), followed by the education system (mostly primary school teachers) This paper focuses on the relationship between education, employment and earnings in Malawi, with the aim to identify potential shortages in human capital and the incentives to be put in place for the country to satisfy its labour needs. It analyzes the relationship between education and employment in Malawi using data from the Integrated Household Survey (IHS-2) 2004-05. The study finds that education is critical to formal employment for both men and women, and leads to higher hourly earnings. Within regular wage employment, secondary education is associated with a 123 percent wage premium, and university education with a 234 percent wage premium (relative to illiteracy). In both rural and urban areas, income is positively correlated with specialization in regular wage employment. For example, in urban areas 60 percent of the households who derive at least 75 percent of their income from regular wage employment belong to the highest quartile of the income distribution. This reflects the relative scarcity of human capital. The study shows that among prime age males (25 to 39 years old), only 10 percent have completed secondary education. For women in the same age group, the situation is even worse, with the rate of completion of secondary schooling as low as 3 percent. Analysis of school enrolment highlights that teenage women experience high dropout rates, which prevent greater female enrolment in higher education, and therefore constrain future participation in the best forms of employment. The study stresses the need to address problems that cause high failure, repetition and drop-out rates for school children from poor households. Cash transfers programs that condition payments to regular school attendance may help sustain demand for education, reducing the opportunity cost of schooling. For such programs to be effective, however, supply side constraints should also be addressed. For example, the provision of monetary incentives aimed at increasing the number of qualified teachers in rural areas, where the majority of the poor live, may help reduce the ratio of students to qualified primary teachers, and may lead to improved quality of learning and pass rates.
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