Search results

Russia has undergone tumultuous changes during the transition process. This has been nowhere more evident than within the labour market. The transition has now progressed to such an extent that it is possible to examine whether the issues of a re‐capitalisation and restructuring of human capital have been addressed. This paper uses the Russian Longitudinal Monitoring Survey to assess rates of return to human capital investments for the years 1994‐1998. It utilises standard earnings functions to assess the returns to education as well as to specific levels of post‐compulsory education and training. This article places specific emphasis on firm level training and the role of the firm, for the purpose of this special issue. Results suggest, in the case of Russia, that significant and positive returns to education and training exist comparable in magnitude to those in other transition countries.

This paper aims to analyze the rates of returns on education in China and in the process raises issues relevant to the management of China’s system of education. In the ongoing great transformation period of China, the rising rates of returns on education may have been indicators reflecting China’s social progressiveness. However, very little research efforts have been devoted to the study of the impacts of such factors as geographical regions and genders, etc. The authors hope to fill these gaps in the literature.

The China Health and Nutrition Survey (CHNS) database is used for this study (University of North Carolina). The longitudinal nature of the data sets covering 1989, 1991, 1993, 1997, 2000, 2004, 2006, 2009 and 2011 provides a good basis for comparative analyses. The theory is grounded upon the Mincer equations through which econometric estimates are then made.

Disparities in returns on education are found between genders and across geographical regions. The regression results show that the women’s returns on education are consistently higher than those of men. However, the scales of such gender differences differ between the rural and urban areas: smaller for rural area and larger, more significantly so for urban. Additionally, we have found that the rates of returns on education in China have risen significantly over these years, and these increases have been largely due to the effects of institutional reforms. The urban-rural gap in their degrees of market orientation has contributed to the differences in their rates of returns on education. The analyses also suggest that foreign direct investment inflows, international trade and the increasing competitiveness from private enterprises render human capital more valuable to urban businesses. In case of the rural areas, a lack of incentive system tends to have contributed to the lower rates of returns on education.

The authors have presented evidence on the trends in the rates of returns on education during China’s critical transition period. Analyses of the possible reasons behind the differential rates of returns are provided. These findings are helpful for the government to shape their policies towards education. For instance, the government should give more emphasis to vocational schooling due to their significantly higher rates of returns.

The purpose of this paper is to investigate the rates of return and the risks of different types of educational paths – all leading to a tertiary educational degree. The paper seeks to distinguish a purely academic educational path from a purely vocational path and a mixed path with loops through both systems.

The paper studies the labor market outcome to compare earnings and calculate net return rates as well as risk measures to investigate whether different educational paths are characterized by different risk‐return trade‐offs. Entrepreneurs are separated from employees in order to examine whether for the same combination of education the labour market outcomes differ between the two groups.

The empirical results are based on the Swiss Labor Force Survey (SLFS) and demonstrate that mixed educational paths are well rewarded in the labor market. However, for entrepreneurs a high return is also associated with a high income variance.

The findings provide evidence for the existence of complementarities between vocational and academic education. Further research on mixed educational paths might provide more insight into this presumed relationship.

Since the results indicate that mixed educational paths are a worthwhile strategy, the permeability of a national education system is a very important educational policy issue.

The study is innovative in three ways: first, it focuses on complete educational paths and not just the highest educational degree. Second, an alternative measure, the Baldwin rate of return, is used to assess the profitability attached to different educational paths. Third, the income risk associated with each educational path is calculated.

Measurement of returns to vocational education has always remained a matter of controversy (Psacharopoulos, 1994; Bennell and Segerstrom, 1998; Ziderman, 1997). Based upon the return evidence many World Bank projects were scrapped (Middleton and Ziderman, 1997, Bennell and Segerstrom, 1998). However, there is again a growing interest for Vocational Education in different countries as well as in international body like UNESCO (Debroy, 2009; King, 2009; McGrath, 2012). Unfortunately there is little justification for this growth from the returns to Vocational Education literature. India is one among the countries where fervent around vocational education and training (henceforth VET) is quite discernible at present. The paper aims to discuss these issues.

Standard Minerian, extended Mincerian and Heckman two-stage methods are used to measure returns to VET vis-à-vis returns to general education in Indian context while taking care of selection bias problem. It is measured at different levels of education since the characteristics of VET changes significantly at different levels of education. This work also considers different classifications of VET (Formal, Hereditary, On the Job). National Sample Survey (NSS) data which recently has included data on VET is used for this measurement.

It shows that the returns to formal VET and On the Job training (OJT) are quite high in the primary level. There is a gradual decline in these returns when compared with general education at higher levels, namely, secondary and tertiary level. At tertiary level effect of formal VET or OJT on income becomes almost insignificant. On the other hand, hereditary training and other category of VET have significantly negative impact and insignificant impact on income, respectively.

This work suggests that the investment in VET in present context is justified however there is a requirement to focus on specific area within the VET for this investment. Investment in higher level of formal VET as well as in the OJT set up can provide better return to the individuals. However, NSS data does not provide income data for the self-employed persons. Hence, self-employed category remains outside the purview of this study.

In general, formal VET and OJT are profitable for individual in wage employment. However, this profitability declines when the effect of the training is measured at a higher level of general education. Formal vocational training/OJT for the primary and secondary school dropouts are clearly profitable. However, OTJ seems to be providing a return similar to what is provided by formal training. A poor performance of formal VET indicates an institutional gap and reflects present cry from industry for “quality” manpower.

To author’s knowledge there is no study on return evidence from various types of VET in Indian context. This study is a deviance from the existing literature on VET in following ways. First, this study suggests that investment in VET can be profitable. Second, many earlier works missed out to consider different types of VET and compare them with general education at different levels. Putting all types of VET into one basket and then analyzing returns has the risk to misleading the policies. Different VETs have completely different dynamics and hence it is required to treat them separately.

Turkey’s first “brain drain” wave began in the 1960s, with doctors and engineers among the first group of emigrants. In recent years, attention has shifted to young university graduates who are seriously contemplating starting their careers abroad as a result of the current economic crisis. Postgraduate studies overseas provide the first step for many in fulfilling this goal. This paper provides an evaluation of the findings of a survey conducted during the first half of 2002 on the return intentions of Turkish students studying abroad. Various factors have been cited as important for student non‐return, including political instability, lower salaries and lack of employment opportunities in the home country when studies are completed, as well as a preference to live abroad. In addition to these factors, several other features of Turkey’s political economy are considered to be important in explaining the Turkish brain drain.

This study sets out to investigate the pattern of benefits from education along the earnings distribution and compares this pattern between general and vocational/technical education in Singapore, with a particular focus on male‐female differences.

Quantile regression methodology is used, which allows for estimates of education benefits that differentiate the contribution of the quantity and quality of education along the earnings distribution. The quantile regression estimates highlight where in the income/ability distribution the impact of education is more pronounced.

Finds that, while the pattern of returns to an additional year of education for general education follows that of other high income countries, exhibiting increasing returns to education as one goes from lower to higher income quantiles, the returns to vocational education exhibit much lower heterogeneity. Based on the findings, the vocational education system in Singapore has served women with secondary vocational qualifications particularly well. They earn more, have higher labor force participation, experience higher employment rates and are associated with a narrower gender earnings gap compared with women with general education. However, this is not the case for women with polytechnic qualifications, who earn much less than men with such qualifications.

The findings suggest that, by and large, Singapore's vocational education system at the secondary level has successfully addressed the needs of the industry and has contributed towards narrowing gender earnings differentials. It has also contributed towards less overall earnings inequality, because it results in less heterogeneity in the returns to education, compared with general education. However, the curricula of polytechnics need to be re‐examined to identify the cause of the sharply lower female benefits from this type of education.

The paper contributes to the empirical literature with its use of the quantile regression methodology in evaluating the benefits of vocational versus general education for men and women.

Education system stimulates the development of human capital and provides informative signaling allowing to differentiate productivity of individuals. If education system is efficient then higher levels of education usually associated with greater returns on labor market. To evaluate the efficiency of Russian education system we aim to estimate the effect of vocational education and different levels of higher education on wages.

We use data on 8,764 individuals in the years 2019–2021. Our statistical approach addresses two critical issues: nonrandom selection into employment and the endogeneity of education choice. To tackle these problems, we employed Heckman’s method and its extension that is a structural model which addresses the issue of self-selection into different levels of education.

The results of the analysis suggest that there is a significant heterogeneity in the returns to different levels of education. First, higher education, in general, offers substantial wage premiums when compared to vocational education. Specifically, individuals with specialist’s and bachelor’s degrees enjoy higher wage premiums of approximately 23.59–24.04% and 16.43–16.49%, respectively, compared to those with vocational education. Furthermore, we observe a significant dis-parity in returns among the various levels of higher education. Master’s degree provides a substantial wage premium in comparison to both bachelor’s (19.79–20.96%) and specialist’s (12.64–13.41%) degrees. Moreover, specialist degree offers a 7.16–7.55% higher wage premium than bachelor’s degree.

We identify a hierarchical pattern in the returns associated with different levels of higher education in Russia, specifically “bachelor-specialist-master.” These findings indicate that each level of education in Russia serves as a distinct signal in the labor market, facilitating employers' ability to differentiate between workers. From a policy perspective, our results suggest the potential benefits of offering opportunities to transition from specialist’s to master’s degrees on a tuition-free basis. Such a policy may enhance access to advanced education and potentially lead to higher returns for individuals in the labor market.

There are many studies on returns to higher education in Russia. However, just few of them estimate the returns to different levels of higher education. Also, these studies usually do not address the issue of the endogeneity arising because of self-selection into different levels of education. Our structural econometric model allows addressing for this issue and provides consistent estimates of returns to different levels of education under the assumption that individuals with higher propensity to education obtain higher levels of education.

This chapter uses a college-by-graduate degree fixed effects estimator to evaluate the returns to 19 different graduate degrees for men and women. We find substantial variation across degrees, and evidence that OLS overestimates the returns to degrees with the highest average earnings and underestimates the returns to degrees with the lowest average earnings. Second, we decompose the impacts on earnings into effects on wage rates and effects on hours. For most degrees, the earnings gains come from increased wage rates, though hours play an important role in some degrees, such as medicine, especially for women. Third, we estimate the net present value and internal rate of return for each degree, which account for the time and monetary costs of degrees. Finally, we provide descriptive evidence that satisfaction gains are large for some degrees with smaller economic returns, such as education and humanities degrees, especially for men.

Purpose – The aim of this chapter is to measure the wage premium associated with various levels of educational attainment using micro-data from the Luxembourg Income Study. The study focuses on working-aged adults in eight developed countries for various years between 1984 and 2005.

Methodology – The chapter computes wage ratios reflecting the premium associated with low, medium, and high levels of educational attainment, which correspond to completion of less than secondary education, secondary education, and tertiary education, or an equivalent level of vocational training. These ratios, along with several other variables, are then related to the 90/10, 75/25, 90/50, and 50/10 wage ratios in a country-level unbalanced pooled cross-sectional time series analysis.

Findings – Returns to education account for an important share of cross-country variation in various modes of wage inequality, although other variables matter as well.

Research limitations – The data needed to compute returns to education data are unavailable for a number of countries and years.

Originality – The chapter offers a more precise measure of the returns to education than earlier cross-national work, which has typically focused on average levels of education and other aggregate measures.

This paper argues that the assumption of a homogeneous workforce, which is implicitly invoked in the decomposition analysis of changes in welfare indicators, hides the role that schooling and its returns may have on the understanding of these changes. Using Peruvian cross-sectional data for a period of 10 years (2004–2013) and counterfactual simulations, this paper finds that the main factor contributing to poverty reduction has been individuals’ changes in labor earnings, and the role of these changes has been less important in reducing income inequality. The main driving force of reduced income inequality has been the fall in returns to education, which at the same time has been one of the important factors to constraining the period’s remarkable progress in poverty reduction and expansion of the middle class.