Economic growth and the demand for education: Is there a wealth effect?

Human capital investment in developing countries is thought to be significantly constrained by household resources. This paper studies the relationship between household resources and the demand for education using recent household survey data from Vietnam. The data cover a period, 1993–1998, of exc...

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Bibliographic Details
Published in:Journal of development economics 2004-06, Vol.74 (1), p.33-51
Main Authors: Glewwe, Paul, Jacoby, Hanan G
Format: Article
Language:English
Subjects:
Bildungsinvestition
Consumption
Demand
Developing countries
Development economics
Development studies
Economic growth
Economics of education
Education
Enrollments
Households
Human capital
Investition
LDCs
Returns to education
Studies
Vietnam
Wealth
Wirtschaftswachstum
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Summary:Human capital investment in developing countries is thought to be significantly constrained by household resources. This paper studies the relationship between household resources and the demand for education using recent household survey data from Vietnam. The data cover a period, 1993–1998, of exceptional income growth in Vietnam, during which secondary school enrollment rose substantially. Using consumption expenditures to measure household wealth, we find a positive and significant relationship between changes in wealth and changes in the demand for education. This wealth effect persists even after controlling for locality-specific factors such as changes in education returns and the supply and quality of schools, and for the opportunity costs of schooling.
ISSN:0304-3878
1872-6089
DOI:10.1016/j.jdeveco.2003.12.003