Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/272664 
Year of Publication: 
2023
Series/Report no.: 
IZA Discussion Papers No. 16037
Publisher: 
Institute of Labor Economics (IZA), Bonn
Abstract: 
In this paper, we examine the wage returns to an extra year of primary school using a policy reform in Egypt, which reduced compulsory primary schooling from 6 to 5 years. Since this policy changed the duration of primary school while providing the same diploma, we can estimate the human capital effects holding the sheepskin effects constant. We find that the wage returns to an extra year of primary school for Egyptian men aged 24–44 is a statistically insignificant 2–4 percent. Despite the low returns for the overall population, the returns are much higher for men born in rural areas and men whose fathers have low levels of education—indicating important human capital effects for underprivileged boys. Consistent with this result, we find that the policy effects of a one-year reduction in primary schooling on schooling attainment at various levels are more adverse for underprivileged boys. Our findings, therefore, suggest that such a policy could be particularly detrimental for students from lower socioeconomic groups—contributing to increased inequality.
Subjects: 
returns to schooling
early human capital investment
instrumental variables
compulsory education duration
Egypt
JEL: 
J18
J31
I21
I28
Document Type: 
Working Paper

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