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The Returns to Education in Africa: Some New Estimates

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  • Mahdi Barouni
  • Stijn Broecke
Abstract
We estimate the rate of return to education for 12 African countries using recent data and a range of methodologies, which we apply consistently across all countries. Our findings confirm that the return to basic education is the lowest (7-10%). The returns to upper secondary and tertiary education are similar to one another (25-30%). Accounting for the risk of joblessness increases these rates of return, particularly for basic education and for women at tertiary level. Our results at the country level suggest that great care should be taken in choosing the appropriate methodology to estimate rates of return.

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  • Mahdi Barouni & Stijn Broecke, 2014. "The Returns to Education in Africa: Some New Estimates," Journal of Development Studies, Taylor & Francis Journals, vol. 50(12), pages 1593-1613, December.
    • Handle: RePEc:taf:jdevst:v:50:y:2014:i:12:p:1593-1613
    DOI: 10.1080/00220388.2014.936394
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    References listed on IDEAS

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    1. George Psacharopoulos & Harry Anthony Patrinos, 2004. "Returns to investment in education: a further update," Education Economics, Taylor & Francis Journals, vol. 12(2), pages 111-134.
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    Cited by:

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    3. Kentaro Shimada & Zeba Khan & Suguru Mizunoya & Ayako Wakano, 2016. "An Update of the Returns to Education in Kenya: Accounting both endogeneity and sample selection biases," Discussion Papers in Economics and Business 16-18, Osaka University, Graduate School of Economics.
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    5. Bennell, Paul, 2021. "The political economy of attaining Universal Primary Education in sub-Saharan Africa: Social class reproduction, educational distancing and job competition," International Journal of Educational Development, Elsevier, vol. 80(C).
    6. Abebe Shimeles, 2016. "Can higher education reduce inequality in developing countries?," IZA World of Labor, Institute of Labor Economics (IZA), pages 273-273, July.
    7. Sergio Urzua, 2019. "Redistribution Through Education: The Value of Public Education Spending," Commitment to Equity (CEQ) Working Paper Series 88, Tulane University, Department of Economics.
    8. Kingsbury, Ian, 2018. "Making sense of low private returns in MENA: A human capital approach," International Journal of Educational Development, Elsevier, vol. 61(C), pages 173-183.
    9. Carl-Johan Dalgaard & Henrik Hansen, 2017. "The Return to Foreign Aid," Journal of Development Studies, Taylor & Francis Journals, vol. 53(7), pages 998-1018, July.
    10. Ivar Kolstad & Arne Wiig, 2015. "Education and entrepreneurial success," Small Business Economics, Springer, vol. 44(4), pages 783-796, April.
    11. Hang Thu Nguyen & Hiep Manh Nguyen & Michael Troege & Anh T. H. Nguyen, 2021. "Debt aversion, education, and credit self-rationing in SMEs," Small Business Economics, Springer, vol. 57(3), pages 1125-1143, October.
    12. Tillmann Heidelk, 2019. "The Returns to Education in the Context of a Natural Disaster: Evidence from the 2010 Earthquake in Haiti," Working Papers ECARES 2019-17, ULB -- Universite Libre de Bruxelles.
    13. Heath Milsom, Luke, 2023. "Spatial inequality of opportunity in West Africa," Journal of Public Economics, Elsevier, vol. 225(C).
    14. Tony Addison & Amir Lebdioui, 2022. "Public savings in Africa: Do sovereign wealth funds serve development?," WIDER Working Paper Series wp-2022-159, World Institute for Development Economic Research (UNU-WIDER).
    15. Zavale, Nelson Casimiro & Macamo, Elísio, 2016. "How and what knowledge do universities and academics transfer to industry in African low-income countries? Evidence from the stage of university-industry linkages in Mozambique," International Journal of Educational Development, Elsevier, vol. 49(C), pages 247-261.
    16. Sam Jones & Thomas Pave Sohnesen & Neda Trifković, 2018. "The evolution of private returns to education during post-conflict transformation: Evidence from Mozambique," WIDER Working Paper Series wp-2018-143, World Institute for Development Economic Research (UNU-WIDER).
    17. Sam Jones & Neda Trifkovic & Thomas Sohnesen, 2018. "The evolution of private returns to education during post-conflict transformation: Evidence from Mozambique," WIDER Working Paper Series 143, World Institute for Development Economic Research (UNU-WIDER).
    18. Harry A Patrinos & George Psacharopoulos, 2023. "Estimating returns to education: back to the short-cut," Economics Bulletin, AccessEcon, vol. 43(3), pages 1208-1213.
    19. Reham Rizk, 2016. "Returns to Education: An Updated Comparison from Arab Countries," Working Papers 986, Economic Research Forum, revised Apr 2016.
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    21. Francesca Marchetta & Tom Dilly, 2019. "Supporting Education in Africa: Opportunities and Challenges for an Impact Investor," Working Papers hal-02288103, HAL.

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