The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.
A decomposition of output growth rates of Middle Eastern and North African countries shows that the contributions of human capital-augmented labor and physical capital to output growth are comparably small and stable over time and that in most countries a considerable share of output growth is attributed to growth in total factor productivity. This paper empirically assesses the determinants of total factor productivity in the Middle East and North Africa region between 1980 and 2009. The findings suggest that human capital is not only an input factor of production but also a quantity that changes the efficiency by which existing input factors are used. Domestic innovations appear to be efficient only if a certain level of educational attainment is reached by a country. In addition, human capital contributes to the ability of efficient adoption of technology from abroad and allows a faster catch-up with technological leaders. Globalization, in combination with a (comparably low) threshold endowment of human capital, is estimated to increase total factor productivity in Middle Eastern and North African countries.
We assess empirically the changes in returns to education at the subnational level in Uganda using the Uganda National Household Surveys for 2002/2003 and 2005/2006. Our results indicate that average returns to schooling tended to converge across regions in the last decade. The overall trend in convergence of returns to schooling took place at all levels of educational attainment and this behaviour in returns to education is mostly driven by the dynamics of returns to schooling in urban areas. We analyse subnational convergence in returns to education and unveil deviant dynamics in Northern Uganda. We discuss the potential challenges to inclusive economic growth in Uganda which are implied by our results.
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