Does Education Pay In South Africa? Estimating Returns To Education Using Two Stage Least Squares Approach

Biyase, Mduduzi; Zwane, Talent

doi:10.19030/iber.v14i6.9508

Cited by 6 publications

(5 citation statements)

References 18 publications

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“…Crespo Cuaresma and Raggl (2016) demonstrated that the return to schooling was more than 5 percent in Uganda. Biyase and Zwane (2015) used the fixed effects model and found that the return to education was 2.2 percent in South Africa. Peet et al (2015) used 61 nationally representative household surveys from 25 developing countries between 1985 and 2012, and showed that the return to education in developing countries was 7.5 percent.…”

Section: Previous Studies Regarding Returns To Educationmentioning

confidence: 99%

Changes in returns to education for off-farm wage employment: evidence from rural China

Wang

Dong

Luo

et al. 2018

CAER

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Purpose The purpose of this paper is to examine the role of education in the labor market and to understand how returns to education change over time in rural China. Design/methodology/approach Using nationally representative survey data from 2004 to 2015, this study provides insights on wage determination in the labor market and examines how the returns to education in rural China differ with time and educational endowment. This study applies ordinary least squares estimation and the Heckman selection model to estimate the returns to education. Findings The returns to education decreased during the observed years from more than 6 percent in 2004 to only about 3 percent in 2011, rising to nearly 4 percent in 2015. The overall trend is robust and observed within groups defined by education. Additionally, the returns to education vary greatly with educational endowment. Tertiary education has always maintained a high rate of returns at nearly 10 percent, while returns to senior high school education and below have gradually diminished. Originality/value The authors believe that the results will not only enrich studies on the returns to education in rural China, but also provide a basis for diagnosing the changes of rural labor market in the early twenty-first century.

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Section: Previous Studies Regarding Returns To Educationmentioning

confidence: 99%

Changes in returns to education for off-farm wage employment: evidence from rural China

Wang

Dong

Luo

et al. 2018

CAER

View full text Add to dashboard Cite

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“…We addressed the endogeneity issue by running a two-stage least squares regression. Given the challenges of finding a valid instrumental variable, we followed Gregorio and Lee (2002) and Biyase and Zwane (2015), who used the lagged value of education as an instrument in their studies. We employed the education levels during the past two years as our instrumental variables.…”

Section: Two-stage Least Squaresmentioning

confidence: 99%

The Impact of CEO Educational Background on Corporate Risk-Taking in China

Zhang

Xue

Zhang

2022

JRFM

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This article investigates whether, and how, CEO educational background affects Chinese corporate risk-taking. Using a sample of 4681 firm-year observations from 2012 to 2020, we find that CEO educational background is negatively associated with corporate risk-taking. The nonlinear quadratic regression shows a convex relationship, consistent with the finding that the effect is more profound for the subsample with relatively lower education levels. The negative relationship is stronger for the firms with higher leverage, with lower tangibility, and in non-manufacturing industries. We also address the endogeneity issue using a two-stage least squares regression. This paper may provide valuable insights for shareholders, helping them to hire the most suitable CEOs to achieve shareholders’ objectives and increase the corporation’s competitiveness in the market.

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“…We are not the first to use these data. Biyase and Zwane (2015) use a dynamic panel data estimator to estimate the returns to education in South Africa from 2008-2012; they find that the returns to an additional year of education is approximately 47%. While there is increasing skepticism about the veracity of panel models that use lagged dependent variables as instruments, we use Biyase and Zwane as a benchmark to which we compare our estimated returns to education in various sub-populations of South Africa.…”

Section: Datamentioning

confidence: 99%

Returns to Education in South Africa: Evidence from the National Income Dynamics Study

Depken

Chiseni

Ita

2019

Zagreb International Review of Economics and Business

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We utilize two waves of the National Income Dynamics Study in South Africa to estimate the returns to education in 2010 and 2012. We find that during this time period the returns to education were approximately 18% per year of education and that the returns were higher for females relative to males and higher for those living in urban relative to rural areas. The policy implications include a suggestion to continue investment in educational infrastructure, especially in rural areas, so as to increase the returns to education in those areas.

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Does Education Pay In South Africa? Estimating Returns To Education Using Two Stage Least Squares Approach

Cited by 6 publications

References 18 publications

Changes in returns to education for off-farm wage employment: evidence from rural China

Changes in returns to education for off-farm wage employment: evidence from rural China

The Impact of CEO Educational Background on Corporate Risk-Taking in China

Returns to Education in South Africa: Evidence from the National Income Dynamics Study

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