Effects of male and female education on economic growth: Some evidence from Asia
Introduction
This paper examines the long run growth effects of education using a panel of eighteen Asian countries over the period 1970–2009. The economic benefit of improving education for all is significant, as a more educated society translates into higher rates of economic growth. This is evidenced by the large literature that has emerged on education and economic growth: see Mankiw, Romer, and Weil (1992), Barro (1991), Hanushek (1995), Temple (2000), Krueger and Lindahl (2001), Gemmel (1996), Benhabib and Spiegel (1994) and Dowrick (1995) among others.
Given the current emphasis on education by the United Nations, and the second Millennium Development Goal (MDG) of achieving education for all by increasing enrolment ratios, this study takes a gender-disaggregated and level-specific approach, empirically investigating the effects of male and female education, as measured by primary, secondary and tertiary enrolment ratios, on economic growth. Due to the renewed efforts made by the Asian economies to increase enrolment ratios and allocate resources efficiently in an effort to achieve the MDG of education for all, the present study focuses on Asia. The main differences between this study and a number of previous studies in the literature are as follows. We extend an endogenous growth framework based on congestion effects to accommodate gender-specific enrolment ratios and use an augmented version of the Solow (1956) model to estimate the impact of male and female enrolment at primary, secondary and tertiary educational levels on economic growth. Second, we use the extreme bounds analysis (EBA) of Leamer (1985) and its variants to identify and estimate the gender-disaggregated growth effects of male and female enrolment at different levels of education. The EBA is especially useful when there are several potential explanatory variables and it is necessary to select a few robust explanatory variables. Additionally, estimates based on the EBA reduce model uncertainty and are claimed to be robust (Leamer, 1985).
There are very few studies which examine the effects of education on growth at a gender disaggregated level; see Schultz (1993), Knowles, Lorgelly, and Dorian (2002), Klasen (2002), and Dollar and Gatti (1999). In particular, educating girls increases a country's stock of human capital and growth (Dollar and Gatti, 1999, Klasen, 2002, Knowles et al., 2002, Schultz, 1993). Educating females, just as with males, directly increases the stock of human capital and income, and promotes growth. However, there is a further benefit in educating girls because of the positive influence of mothers on the education and health of their children (Schultz, 2002). Therefore, the emphasis of this paper is on examining the gender-disaggregated effects of education on growth.
The structure of this paper is as follows. Section 2 reviews the literature on education and economic growth; Section 3 discusses the methodology; Section 4 presents the empirical results; and Section 5 concludes.
Section snippets
Review of the literature
Many studies using enrolment ratios have found a positive relationship between primary and secondary education and economic growth: see Barro (1991), Gemmel (1996) and Durlauf and Johnson (1995).
Studies which use disaggregated levels of schooling find that primary and secondary enrolments generally have a positive effect on economic growth, as opposed to tertiary education. Self and Grabowski (2004), in a study of India, find evidence of a strong causal relationship between economic growth and
Methodology
Romer (1986) shows that externalities generated by the education sector can raise labour productivity further, across the whole economy. Our analytical framework is a generalisation of the approach of Lau and Sin, 1997a, Lau and Sin, 1997b where a special form of Romer's (1986) production function is used to assess the impact of externalities of public investment for a closed economy, as follows:where and yjt, kjt, and ljt are the output, physical
Econometric specification and results
What are some important and potentially growth-improving variables for inclusion in growth models? Durlauf, Johnson, and Temple (2005, Chap. 8) find that the number of such potential growth-improving variables in empirical work is as many as 145. There is no endogenous growth model in which the specifications to estimate growth effects use more than one or two growth-enhancing and control variables. Additional explanatory variables are often included in empirical work on an heuristic rather
Conclusion and policy recommendations
In this study, we extend an endogenous growth framework based on congestion effects to measure gender-specific enrolment impacts on economic growth. We employ EBA to measure the growth effects of male and female primary, secondary and tertiary enrolment ratios. We offer two important findings concerning the impact of education on long-run economic growth in Asia. First, we find that male and female primary, secondary and tertiary enrolment ratios have robust and relatively high growth effects
Acknowledgement
We wish to thank three anonymous referees for valuable comments.
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