Average and Marginal Returns to Upper Secondary Schooling in Indonesia

41 Pages Posted: 22 Dec 2011

See all articles by Pedro Manuel Carneiro

Pedro Manuel Carneiro

University College London - Department of Economics; IZA Institute of Labor Economics

Michael Lokshin

World Bank - Development Research Group (DECRG); National Research University Higher School of Economics

Cristobal Ridao-Cano

World Bank - Development Research Group (DECRG)

Nithin Umapathi

World Bank

Multiple version iconThere are 3 versions of this paper

Date Written: December 2011

Abstract

This paper estimates average and marginal returns to schooling in Indonesia using a non-parametric selection model. Identification of the model is given by exogenous geographic variation in access to upper secondary schools. We find that the return to upper secondary schooling varies widely across individuals: it can be as high as 50 percent per year of schooling for those very likely to enroll in upper secondary schooling, or as low as -10 percent for those very unlikely to do so. Average returns for the student at the margin are well below those for the average student attending upper secondary schooling.

Keywords: average return, Marginal return, marginal treatment effect, Return to Education

JEL Classification: J2, J3, J31

Suggested Citation

Carneiro, Pedro Manuel and Lokshin, Michael and Ridao-Cano, Cristobal and Umapathi, Nithin, Average and Marginal Returns to Upper Secondary Schooling in Indonesia (December 2011). CEPR Discussion Paper No. DP8689. Available at SSRN: https://ssrn.com/abstract=1976031

Pedro Manuel Carneiro (Contact Author)

University College London - Department of Economics ( email )

Gower Street
London WC1E 6BT, WC1E 6BT
United Kingdom

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Michael Lokshin

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States
202-473-1772 (Phone)
202-522-1153 (Fax)

HOME PAGE: http://econ.worldbank.org/staff/mlokshin

National Research University Higher School of Economics

Myasnitskaya street, 20
Moscow, Moscow 119017
Russia

Cristobal Ridao-Cano

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street, N.W.
MSN3-311
Washington, DC 20433
United States

Nithin Umapathi

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

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