Human Capital Development Country Case Studies (HCD)

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Analysing the Determinants of Healthcare Insurance Uptake in Nigeria
(African Economic Research Consortium, 2024-08-05) Adekunle, Wasiu; Oluwaseyi, Vincent
The challenge of low health insurance coverage in Nigeria has persisted for decades, hindering access to healthcare, and impacting human capital development negatively. This is despite the diverse types of health insurance schemes co-existing in the country. The current study, therefore, sought to identify the potential factors driving the uptake of health insurance and its types (private and public health insurance) in Nigeria. To achieve the objective, the study assessed cross-sectional data across the 36 States in Nigeria (including the Federal Capital Territory -FCT) obtained from the 2018 Nigeria Demographic and Health Survey (DHS). Accordingly, this study highlighted stylised facts about health insurance and key socio-economic factors, while regression analysis was explored to determine the crucial factors motivating health insurance uptake in Nigeria. The analysis showed that the positive drivers of health insurance uptake (mainly private) include the financial inclusion rate and employment level. The study also observed that due to financial constraints, low-income groups might be less likely to enrol on health insurance than the middle-income and high-income groups. Education is found to have a statistically significant and negative effect on health insurance uptake in the country. On the other hand, health access problems and age of the household head did not have statistically significant effects on health insurance uptake. With the National Health Insurance Authority (NHIA) Act 2021 making health insurance mandatory, it is imperative for the Nigerian government to strengthen the identified positive drivers of health insurance uptake across the country.
Do Social Assistance Interventions Foster School Enrolment? A Case of School Feeding Programmes in Kenya
(African Economic Research Consortium, 2024-08-05) Ogolla,Michael; Nyabaro, Violet; Ngugi, Rose; Onsomu, Eldah
Human capital accumulation through education is important for sustainable development. However, access to education is dependent on several household factors, including presence of a school, children’s health and nutrition, among other inputs. The study sought to assess the effect of school feeding programmes on school enrolment while controlling for various households, learner and school level factors. The study used the Kenya Integrated Household Budget Survey (KIHBS) 2015/16 data, which is a national household dataset with household and community-level information. A probit model was used to undertake the analysis at three basic levels of education, namely: pre-primary, primary and secondary levels. The results show mixed effects of the school feeding programme on enrolment, which differ according to the level of education and type of school. In the pooled sample, there was no significant effect of school feeding programme on enrolment at pre-primary school level, while substantive effects were observed in primary and secondary school levels. The effect of school feeding programmes in public schools is negative whereas it is positive in private schools. The presence of school feeding programmes in pre-primary and primary school levels in arid and semi-arid lands (ASALs) leads to increased enrolment in both the pooled and ASAL sub-sample, whereas access to government bursaries has immense positive outcomes on secondary school enrolment. It is recommended that targeting of school feeding programmes be improved to select schools among low income communities in the ASALs and informal settlements in urban areas. There is need to ensure timely disbursement of funds towards public school feeding programmes at all levels of education. There is also need for increased investment towards bursaries in secondary schools. Finally, county governments need to provide financial support to public pre-primary schools towards school feeding programmes.
Effectiveness of the Universal Health Coverage Scheme in Senegal
(African Economic Research Consortium, 2024-08-05) Diagne, S.; Sylla, F.N.; Henovi, K.C.
The aim of this study is to assess the impact of the universal health coverage (UHC) scheme in Senegal on the use of medical care and employee productivity, and to carry out a cost-effectiveness analysis of the scheme. The data used come from the Harmonized Survey of Household Living Conditions (Enquête Harmonisée sur les Conditions de Vie des Ménages, EHCVM) in Senegal conducted in 2018 by the National Statistics and Demography Bureau (Agence nationale de la statistique et de la démographie, ANSD). The study used the Endogenous Switching Regression (ESR) model to take account of the self-selection bias. Its findings show that the beneficiaries of the scheme had greater access to medical care and lost fewer days of work due to illness than the non-beneficiaries. They also show that if the non-beneficiaries were covered by the UHC scheme, they would have increased their access to medical care and would have lost fewer days of work. These results are consistent since easy access to medical care enables its beneficiaries to receive treatment quickly when they fall ill. But the study also found that although the UHC scheme improved its beneficiaries’ access to medical care and productivity at work, it also increased their medical care costs. Indeed, the cost-effectiveness analysis carried out showed that the scheme was unequivocally ineffective in the case of the 15-60 age group, one which essentially constitutes the working population. In other words, the beneficiaries of the UHC scheme in Senegal incurred more medical care costs and obtained fewer benefits from it than its non-beneficiaries. The study recommends that advocating an extension of the scheme’s coverage, while emphasizing its positive effects on its beneficiaries’ health and productivity at work would lead to enhanced mobilization on the part of the government. In addition, better knowledge of the medical care package offered as part of the scheme and of its effectiveness would enable its beneficiaries to make better use of the benefits its offers. Keywords: Healthcare, Insurance uptake, Socio-economic factors, NHIS, NHIA
Foreign Direct Investment Inflows and Human Capital Development, Apparent Links and the Effect of Transmission Mechanism: Evidence from Burkina Faso
(African Economic Research Consortium, 2024-08-05) BAZIE, Porto; Alain SIRI, Alain
Meeting the challenge of human capital development is a concern for governments and development practitioners in developing countries. However, foreign direct investment (FDI) inflows appear to be a means of meeting this challenge by increasing incomes, mobilising tax revenues, bvoosting productivity and disseminating skills and technologies. The purpose of this paper is to analyse the FDI effects on human capital development through the channel of tax revenue mobilisation. A structural simultaneous equation model, ARDL modelling, and interviews, were used to analyse the data. The results indicate that FDI is a vehicle for tax revenue mobilisation. They also show that tax revenues increase spending on primary, secondary and tertiary education, while FDI significantly enhances primary and tertiary education levels in the long term but reduces secondary education levels in Burkina Faso. In the short term, FDI reduces tertiary education levels but does not affect primary and secondary education levels. The results further show that the Corporate Social Responsibility (CSR) channel is also an effective means of developing human capital through FDI.
Foreign Direct Investments and Human Capital Development in Nigeria: A Firm-Level Analysis of Manufacturing and Information and Communication Technology Industries
(African Economic Research Consortium, 2024-08-05) Taiwo, Shakirudeen; Olofin, Sodik
The emerging trend of Foreign Direct Investments (FDI) in Nigeria is diverging in favour of technology, ICT, and manufacturing, which are becoming more sensitive for the evolution of the labour force. With the low levels of technology advancement, skill accumulation, and human capital stock in developing countries, and Nigeria especially, FDI inflows have been identified as major sources of technology, managerial, and technical know-how spillover to developing countries. The accruing knowledge spillover effects of FDI inflows are critical for human capital development to propel technological progress and sustainable economic growth. Therefore, this study investigated the impacts of FDI on human capital and the economic prospects of workers in Nigeria’s manufacturing and ICT sectors and highlighted the country specific conditions needed to adequately internalize FDI spillover effects on Nigeria's human capital. This study's data analysis is based on a combination of qualitative and quantitative approaches. The findings revealed that FDI inflows impact human capital development in Nigeria. Meanwhile, the kind of FDI inflows, the measure of human capital development and the sector matter in the relationship, as aggregated analysis yields little knowledge benefit. Specifically, this study revealed that all the types of FDI, except merger and acquisition, have varying impacts on the components of human capital development, while efficiency-seeking FDI is the most important. The policy implication from this study re-emphasizes the need for further improvement in the regulatory environment, general ease of doing business and incentive management.
Healthcare Behaviour During a Health Crisis: The Case of Covid-19 in Madagascar
(African Economic Research Consortium, 2024-08-05) Razakamanana, Marilys Victoire; Rakotonirainy, Miora; Ramiandrisoa, Tiarinisaina Olivier
A health crisis can affect the attitude towards healthcare seeking of the population. During the COVID-19 pandemic, two situations arose: people either sought care out of caution and vigilance, or because of the fear of contracting the virus and the health restrictions, they did not consult the healthcare facilities. This paper aims to analyze the effects of a health crisis such as that of COVID-19 on the use of healthcare in Madagascar. Two diseases, diarrhoea and fever, are considered. Fever is a common symptom of COVID-19, and diarrhoea is one of the causes of morbidity in Madagascar and a less common symptom of the pandemic. Using data from the Multiple Indicator Cluster Survey in 2018 and the Rapid Survey on the Socio-Economic Impact of COVID-19 in Madagascar in 2020 and considering the same individuals surveyed in 2018 and 2020, after verification of the endogeneity, the absence of it was raised. Probit models without instrumental variables are used. During the pandemic, in the case of diarrhoea, faced with the fear of a pandemic, people have sought other alternatives, such as Community Health Workers (CHWs), which is considered less risky than health centres (0.33; p-value=0.05). In the case of fever, people out of caution, prefer to consult health centres rather than self-medicate (-1.86; p-value=0.00). People’s behaviour differs according to the symptoms of their illness, diarrhoea being less well-known and less frequent as a symptom of Covid-19 than fever.
Human Capital Development and Household Income Growth in Burkina Faso: Using the Decomposition Method to Understand the Relationship Between the Two
(African Economic Research Consortium, 2024-08-05) SIRI, Alain; Combary, Omer
Understanding how much human capital accumulation and human capital variables contribute to explaining income growth in Burkina Faso is the main objective of this paper. The paper contributes to the literature on link between human capital development and prosperity of occupied people, by applying a new perspective based on the use of the Oaxaca–Blinder variance decomposition procedure. This methodology makes it possible to quantify the relative contribution of each explanatory factor to income growth, and also allows distinguishing both factors endowment effect and returns to endowment effect. The analysis is applied to data of household Living Standards Measurement Surveys conducted in 2009, 2014 and 2018. We found that the endowment in human capital, health, nutrition, education, and productive employment, has a positive and significant influence on income of occupied people. In addition, the decomposition method revealed that the impact of human capital factors on income growth is all the greater when the contributions of the endowment effect and the return effect are both positive and high.
Impact of COVID-19 Pandemic on School Attendance in Kenya
(African Economic Research Consortium, 2024-08-05) Oleche, Martine; Muriithi, Moses; Kamau, Paul; Njoka, John; Ngigi, Samuel
Shocks, whether idiosyncratic or covariate, have been common in many parts of the world and are a development challenge. Shocks ordinarily manifest themselves in many forms, and they affect households and sectors differently depending on the nature and the status in which a household finds itself in when it strikes. Theoretically, shocks of any nature adversely affect human capital development in a country. The COVID-19 pandemic was one of the most recent and severe shocks that brought the entire globe to a halt. This paper was designed to investigate how COVID-19 affected school attendance in Kenya as a form of human capital development. Kenya’s gains in human capital development have been adversely affected by the COVID-19 pandemic, which hit the country in March 2020. Arguably, the COVID-19 pandemic worsened the education sector due to closure of schools for a period of at least seven months (March October 2020). While some learners were able to transition to online studies, most students especially in public schools, stayed at home without any form of learning. The results show that presence of COVID-19 incidences reduced the probability of children attending school. Being a male child and child belonging to a single parent household head had a reduced probability of school attendance. Households with higher incomes had an increased probability of school attendance while controlling for COVID-19 incidences. Children from elderly household heads had a reduced probability of school attendance when controlling for COVID-19 incidences. In future, there is need to put measures that can support public primary schools to cope with such shocks, e.g. acquisition of ICT gadgets, subsidised data bundles and basic media equipment that facilitates remote learning.
Rethinking Public Investment in Education in Africa: The Labor Market Response of Public Investment in Education in Ethiopia
(AERC, 2025) Adem, Jemal Mohammed; Weldesilassie, Alebel Bayrau
This study investigates the impact of education investments on economic outcomes in Ethiopia, grounded in human capital theory and the Mincerian earnings function. While substantial public expenditure on education has resulted in a significant increase in university graduates over the past two decades, a paradox persists: high unemployment rates among graduates coexist with a notable shortage of skilled labor in firms. This research employs longitudinal data from Ethiopia's national labor force survey to explore the complexities of education returns through an over-required-under-education model, which categorizes workers based on their educational qualifications relative to job requirements. The findings indicate that government investment has successfully mitigated under-qualification but has concurrently contributed to rising over qualification, with approximately 13% of workers classified as over-qualified in 2021. Productivity analysis reveals that workers with the required educational qualifications outperform both over-qualified and under qualified peers. Notably, while under-qualified workers see positive returns from additional schooling, over-qualified workers experience negative returns, suggesting diminishing benefits of excess education. These insights highlight the critical need for policymakers to link education investments with effective human capital utilization strategies to prevent counterproductive outcomes, ultimately fostering a more productive labor market in Ethiopia.
Return Migration and Labour Market Integration in Senegal
(African Economic Research Consortium, 2024-08-05) Diallo, Mamadou Abdoulaye; Diallo, Soukeyna; Sika, Mashoudou Maman Chabi
The aim of this study was to assess the effect of return migration on labour market integration in Senegal. To this end, we based the study on the recent survey on international migration in Senegal (EMIS-2019), data for which were collected by the Consortium for Economic and Social Research (Consortium pour la recherche économique et sociale, CRES) in collaboration with the World Bank. We used the two-stage residual inclusion (2SRI) method and complemented it by an instrumental variable (IV) approach to account for the potential selection bias associated with return migration. The findings show that return migration had a positive and significant effect on labour market integration. Specifically, the results show that their migration status in the host country, the mode of their return to their country of origin, the skills they acquired in the host country, and their social capital played an important role in their economic reintegration after their return. This study therefore stresses the need for return-migration incentive policies and support for labour market integration of the return migrants.
School Canteen Programme and School Performance in Madagascar
(African Economic Research Consortium, 2024-08-05) Rakotonirainy, Miora; Ramiandrisoa, Olivier; Razakamanana, Marilys
Implementing a school feeding programme to support education is common practice in most States, particularly in developing countries. One of the aims of the programme is to help improve educational outcomes for pupils. Although there is a relationship between the school feeding programme and educational outcomes, the programme does not necessarily lead to its effectiveness. This paper therefore aims to shed more light on the factors that explain the performance of the school feeding programme and its effects on pupils' learning outcomes at the end of primary school by studying the case of Madagascar. The results reveal the limited impact of the school canteen programme on pupils' and mathematics scores. Analyses revealed that while school feeding improves pupils' reading skills, it has no significant effect on their mathematical skills. It was also noted that although the impact of the programme was not palpable for public primary schools, a modest improvement in school results was observed for pupils in private schools. This research work concludes that the effectiveness of the school canteen programme also depends on multiple criteria linked to the environment of the target pupils. It will be difficult for the programme to achieve its full effectiveness in terms of school performance as long as the socio economic context of the pupils remains critical and the quality of teaching remains low.
The Economy-Wide Impact of Harnessing Human Capital Development: A Dynamic Computable General Equilibrium Model Analysis
(African Economic Research Consortium, 2024-08-05) Yeshineh, Alekaw Kebede; Woldeyes, Firew Bekele
This study uses a Computable General Equilibrium (CGE) model to analyse the impact of skilled and semi-skilled labour supply shocks on the overall Ethiopian economy and sectoral outputs. The study considers three policy scenarios: a 10% increase, a 15% increase, and a 20% increase in skilled and semi-skilled labour supply compared to a business-as-usual (BAU) scenario. The results of the study show that all the three scenarios lead to higher economic growth, investment, and exports. The impact on sectoral outputs is also positive, with the industry and services sectors performing better than the agriculture sector. Specifically, the results of a 20% increase scenario show that real annual Gross Domestic Product (GDP) growth rate will be 0.79 percentage points higher than the business-as-usual scenario. It also shows that annual growth rates of investments and exports will be 2.69 and 2.31 percentage points higher, respectively, than the business-as-usual scenario counterparts. Furthermore, annual production of the agriculture sector grows marginally by 0.16 percentage points, higher than the business-as-usual scenario. Output in the industry sector also increases by 1.61 percentage points higher than the business-as-usual scenario, while outputs in the services sector improve significantly as well. Overall, the study finds that increasing the supply of skilled and semi-skilled labour has a positive impact on the economy. This is because skilled and semi-skilled workers are more productive and can contribute to higher economic growth. The findings of this study have important implications for policy makers. Governments could implement policies to increase the supply of skilled and semi-skilled labour, for example by investing in education and training programmes. This would boost economic growth and improve the living standards of the population.
The Impact of Free Primary Education Policy on Human Capital Development in Kenya: Wins and Losses
(African Economic Research Consortium, 2024-08-05) Ngigi, Samuel; Njoka, John; Kamau, Paul; Oleche, Martine; Muriithi, Moses
This report is based on a case study of human capital development in Africa, focusing on Free Primary Education (FPE) policy in Kenya passed in 2003. We address the policy contribution of Free Primary Education to human capital development in Kenya. The paper analyses and documents the wins and losses of the policy with regard to educational outcomes of enrolment, completion and transition from primary to secondary level education. The report uses the systems approach and mainly desk review of World Bank 30-year series data between 1989 and 2020. The results show that the FPE policy, albeit passed through a political declaration and manifesto devoid of much analysis at the time, made useful contributions to the three outcomes of enrolment, completion and transition. However, there were misses in learner achievement, gender and regional disparities. In addition, investments in reducing the teacher-pupil ratio made marginal sense. Drawing from these results, we recommend that human capital development policies in Africa be done in a more consultative way, whereby policy makers and technocrats discuss different scenarios before implementation. There is also a need to pay more attention to the quality of education offered beyond access and enrolment.

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