Private returns to higher education in Nigeria
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Date
2004-03-03
Authors
O.B. Okuwa
Journal Title
Journal ISSN
Volume Title
Publisher
AERC
Abstract
The idea of education as a capital good is rooted in the concept of “human capital”,
which attaches a high premium to human skills as a factor of production in the development
process. Education is known to be an important determinant of earnings in market
economies. The higher an individual’s educational attainment, the higher that individual’s
expected starting salary and the steeper the rise in earning capacity over time, especially
during the early working years. This study investigates the variation in the rate of return
to different levels of education.
The study endeavours to determine the relationship between years of schooling and
earnings (rate of return) in Nigeria. The effect of the amount of time in the labour force
on earnings is also examined and an attempt made to highlight and calculate the private
rates of return to graduates of higher educational institutions according to sectors of the
economy and sex of the graduate.
The descriptive statistics and ordinary least squares (OLS) estimation results reveal
that the mean monthly earnings of workers increase with more years of schooling. The
private rate of returns is low for graduates of colleges of education. It is higher for
polytechnic graduates and higher still for university graduates. Furthermore, the mean
earnings increase with higher years of labour market experience.
Thus, the higher the level of education, the higher the rate of return to the individual.
Efforts should be made to improve the quality and investment in this level of education
by encouraging private individuals to invest in and pay for higher education.
Description
LA 1633 . 0395 2004
Keywords
, Education , Higher - Economic aspects - Nigeria Econometric Models , Rate of return - Nigeria - Econometric models