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The effect of schooling on worker productivity: Evidence from a South African industry panel

Author

Listed:
  • Rulof P. Burger

    (Department of Economics, University of Stellenbosch)

  • Francis J. Teal

    (Centre for Studies of African Economics, University of Oxford)

Abstract
Schooling is typically found to be highly correlated with individual earnings in African countries. However, African firm or sector level studies have failed to identify a similarly strong effect for average worker schooling levels on productivity. This has been interpreted as evidence that schooling does not increase productivity levels, but may also indicate that the schooling effect cannot be identified when using a schooling measure with limited variation. Using a novel South African industry-level dataset that spans a longer period than typical firm-level panels, this paper identifies a large and significant schooling effect. This result is highly robust across different estimators that allow for correlated industry effects, measurement error, heterogeneous production technologies and cross-sectional dependence.

Suggested Citation

  • Rulof P. Burger & Francis J. Teal, 2014. "The effect of schooling on worker productivity: Evidence from a South African industry panel," Working Papers 04/2014, Stellenbosch University, Department of Economics.
    • Handle: RePEc:sza:wpaper:wpapers209
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    File URL: https://www.ekon.sun.ac.za/wpapers/2014/wp042014/wp-04-2014.pdf
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    References listed on IDEAS

    as
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    2. Eberhardt, Markus & Teal, Francis, 2008. "Modeling technology and technological change in manufacturing: how do countries differ?," MPRA Paper 10690, University Library of Munich, Germany.
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    Cited by:

    1. Sophie Witter & Maja Jakobsen, 2017. "Choices for spending government revenue: New African oil, gas, and mining economies," WIDER Working Paper Series 150, World Institute for Development Economic Research (UNU-WIDER).
    2. Favour O. Olarewaju & Oluwafadekemi S. Areo & Adeyemi A. Ogundipe & Toun Y. Ogunbiyi & Abiola J. Asaleye, 2020. "Capital and Labour Productivity: A Comparative Study of Nigeria and South Africa," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 10(12), pages 1384-1395, December.
    3. Marisa Fintel & Asmus Zoch & Servaas Berg, 2017. "The Dynamics of Child Poverty in South Africa Between 2008 and 2012," Child Indicators Research, Springer;The International Society of Child Indicators (ISCI), vol. 10(4), pages 945-969, December.
    4. Sophie Witter & Maja Jakobsen, 2017. "Choices for spending government revenue: New African oil, gas, and mining economies," WIDER Working Paper Series wp-2017-150, World Institute for Development Economic Research (UNU-WIDER).

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    More about this item

    Keywords

    Returns to schooling; human capital; labour demand; panel data econometrics; South Africa;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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