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Title:The Returns to Education in Rwanda
Authors:Lassibille, Gerard
Tan, Jee-Peng
Periodical:Journal of African Economies
Geographic term:Rwanda
cost-benefit analysis
wage differentials
Education and Oral Traditions
Labor and Employment
Economics and Trade
Abstract:Based on data from the 1999-2001 Household Living Conditions Survey conducted by the Ministry of Finance and Economic Planning, the authors estimate wage equations for employees in Rwanda, treating the choice of employment sector as an endogenous process and making separate estimates for workers in the modern and traditional sectors of the economy. The results show that returns to education increase with the level of education, contrary to the pattern typically reported in the literature and that the returns to higher education are particularly high in Rwanda. A noteworthy feature in the results is that the returns to education are quite different across sectors of employment. In the informal sector, the returns to primary education and those to vocational and secondary general education exceed by a relatively large margin the returns to the corresponding levels of education in the modern sector. A decomposition of the wage differentials across sectors of employment indicates that personal endowments, particularly in terms of educational attainment, are more important in accounting for the wage gaps, than are the difference in their impact on earnings. Bibliogr., notes, ref., sum. [Journal abstract]