Skills and training programs

  • Do school inputs crowd out parents’ investments in their children?

    Public education tends to crowd out parents’ time and money, but careful policy design may mitigate this

    Birgitta Rabe, May 2019
    Many countries around the world are making substantial and increasing public investments in children by providing resources for schooling from early years through to adolescence. Recent research has looked at how parents respond to children’s schooling opportunities, highlighting that public inputs can alternatively encourage or crowd out parental inputs. Most evidence finds that parents reduce their own efforts as schooling improves, dampening the efficiency of government expenditure. Policymakers may thus want to focus government provision on schooling inputs that are less easily substituted.
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  • Labor market consequences of the college boom around the world Updated

    Better information on university quality may reduce underemployment and overeducation in developing countries

    As the number of secondary school graduates rises, many developing countries expand the supply of public and private universities or face pressure to do so. However, several factors point to the need for caution, including weak job markets, low-quality university programs, and job–education mismatches. More university graduates in this context could exacerbate unemployment, underemployment, and overeducation of professionals. Whether governments should regulate the quantity or quality of university programs, however, depends on the specific combination of factors in each country.
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  • Managerial quality and worker productivity in developing countries

    This is a revision of the original article.

    David H. Autor, February 2018
    This is a revision of the original article. Productivity differences across firms and countries are surprisingly large and persistent. Recent research reveals that the country-level distributions of productivity and quality of management are strikingly similar, suggesting that management practices may play a key role in the determination of worker and firm productivity. Understanding the causal impacts of these practices on productivity and the effectiveness of various management interventions is thus of primary policy interest.
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  • Fighting employment informality with schooling

    Labor force composition is critical for understanding employment informality in developing countries

    Daniel Haanwinckel, October 2017
    Developing countries have long been struggling to fight informality, focusing on instruments such as labor legislation enforcement, temporary contracts, and changes in taxes imposed on small firms. However, improvements in the labor force’s schooling and skill level may be more effective in reducing informality in the long term. Higher-skilled workers are typically employed by larger firms that use more capital, and that are more likely to be formal. Additionally, when skilled and unskilled workers are complementary in production, unskilled workers’ wages tend to increase, adding yet another force toward reducing informality.
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  • Adult literacy programs in developing countries

    While mostly missing their primary objectives, adult literacy programs can still improve key socio-economic outcomes

    Niels-Hugo Blunch, July 2017
    In addition to the traditional education system targeting children and youth, one potentially important vehicle to improve literacy and numeracy skills is adult literacy programs (ALPs). In many developing countries, however, these programs do not seem to achieve these hoped for, ex ante, objectives and have therefore received less attention, if not been largely abandoned, in recent years. But, evidence shows that ALPs do affect other important socio-economic outcomes such as health, household income, and labor market participation by enhancing participants’ health knowledge and income-generating activities.
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  • Microfinance and rural non-farm employment in developing countries

    Expansion of microfinance to rural areas may reduce credit constraints, helping non-farm sector growth, employment, and development

    Shyamal Chowdhury, April 2017
    The rural non-farm sector plays an important role in diversifying income for rural households in developing countries and has the potential to emerge as a major source of employment. In some cases it has outgrown the agricultural sector, in part due to the expansion of credit through microfinance institutions that are supported by governments, donor agencies, and businesses. However, future expansion of the rural non-farm sector requires increased flexibility in credit contracts, as well as decreasing the cost of credit and the delivery of complementary inputs, e.g. skills training.
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  • Is teacher certification an effective tool for developing countries?

    Increasing teacher certification in developing countries is widely believed to improve student performance; yet the evidence suggests otherwise

    Todd Pugatch, April 2017
    Teachers are perhaps the most important determinant of education quality. But what makes a teacher effective? Developing countries expend substantial resources on certifying teachers and retaining those who become certified; moreover, policymakers and aid donors prioritize increasing the prevalence of certified teachers. Yet there is little evidence that certification improves student outcomes. In fact, augmenting a school's teaching corps with contract teachers hired outside the civil service and without formal qualifications may be more effective in boosting student performance.
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  • How do adult returns to schooling affect children’s enrollment?

    Raising future expected monetary gains to schooling and poor families’ current incomes promotes school enrollment in developing countries

    Kenneth A. Swinnerton, October 2016
    Universal completion of secondary education by 2030 is among the targets set by the United Nations’ Sustainable Development Goals. Higher expected adult wages traced to schooling may play a major role in reaching this target as they are predicted to induce increased school enrollment for children whose families wish to optimally invest in their children’s future. However, low incomes and the obligation to meet immediate needs may forestall such investment. Studies suggest that school enrollment in developing countries is positively correlated with higher expected future wages, but poor families continue to under-enroll their children.
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  • Can higher education reduce inequality in developing countries?

    Expanding higher education might solve rising youth unemployment and widening inequality in Africa

    Abebe Shimeles, July 2016
    Developing countries often face two well-known structural problems: high youth unemployment and high inequality. In recent decades, policymakers have increased the share of government spending on education in developing countries to address both of these issues. The empirical literature offers mixed results on which type of education is most suitable to improve gainful employment and reduce inequality: is it primary, secondary, or tertiary education? Investigating recent literature on the returns to education in selected developing countries in Africa can help to answer this question.
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