Returns to education : an updated comparison from Arab countries

Abstract EN

The paper provides a comparative study of private rate of return to education in Tunisia, Palestine, Sudan and Egypt using similar specifications, methodology and surveys.

The paper employ 2010/2011 round of the Harmonized Household Income Expenditure Surveys of three Arab countries, namely, Egypt, Tunisia and Palestine.

In addition, the 2009 round of Sudan is used.

The paper attempts to estimate the rate of return to schooling in four Arab countries to learn more about the pattern of rewards to different levels of schooling and how individuals use these benefits to invest in education.

Moreover, the paper attempts to link the structure of returns to education to labor market institutions.

The findings of the paper confirm less consistency in the structure of returns in Arab countries and this is due to difference in education quality and supply and demand of graduates which has a significant influence on returns to schooling.

The findings support that returns to education increases with years of schooling in Egypt due to rigid labor market, as more attention is given to credentials on behalf of skills.

The rate of return on tertiary education is higher compared to basic education in all countries in standard Mincerian model.

Returns to education are higher for females than males for all countries except for Sudan and Tunisia on tertiary level after accounting for jobs and regional disparity.