Does Economic Growth Increase the Demand for Schools?

Edited by Andrew D. Foster and Mark R. Rosenzweig

in Economic Policy Reforms and the Indian Economy

Published by University of Chicago Press

Published in print July 2002 | ISBN: 9780226454528
Published online February 2013 | e-ISBN: 9780226454542 | DOI:
Does Economic Growth Increase the Demand for Schools?

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This chapter investigates whether low levels of schooling infrastructure and low schooling investment are solely the product of failed educational polices or whether they reflect instead, or at least in addition, inadequate economic policies and consequently low school demand. Augmenting and sustaining the rate of economic growth is a powerful policy tool for increasing the human capital of the population. Land prices seem to be a moderately sensitive and statistically substantial predictor of yield growth. The increase in wealth has a significant but less powerful effect on rural secondary school construction compared with raising the expected growth rate and thus the returns to schooling. Furthermore, the expected growth rates in agricultural productivity have had significant effects for given wealth levels on school construction and on enrollment rates, while wealth effects, for given productivity increases, have on average had negligible effects on enrollment.

Keywords: schooling infrastructure; schooling investment; educational polices; economic growth; human capital; wealth; rural secondary school; school construction; agricultural productivity

Chapter.  8176 words.  Illustrated.

Subjects: International Economics

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