Essays on Skilled Workers and Economic Development

This thesis consists of three chapters on skilled workers and the roles they play in economic development. In the first chapter, I use an overlapping generations model of education choice and skilled migration to study conditions under which a low-skill economy can grow its skilled labor force in the presence of skilled emigration. This occurs when skill premiums are low, and there are individuals in the economy who can afford an education. The model is calibrated to data on 23 low and middle-income countries. For 22 of the 23 countries, any increase in the rate of skilled emigration leads to a net decline in the steady-state proportion of skilled workers. This is because increasing skilled emigration rates increases future expected benefits to skill, but leaves current schooling costs the same. So more people do not obtain an education because cost constraints are binding. I then provide empirical evidence that the cost of education is relatively high in developing countries, and that these costs are likely binding using information on the (un)availability of student loan programs. Poland is the only country which benefits from skilled emigration due to a combination of very low skill premiums and low costs of education. For brain drain to lead to a net increase in human capital, reducing education costs and relaxing credit constraints are important policy responses. The second chapter studies the effects of education policies emphasizing basic education at the expense of higher levels of education. Larger estimates of the wage returns to basic education compared to higher levels of education, after adjusting for public costs, are often cited as evidence of over-investment in higher education. These estimates have provided a justification for the shift of public funding towards basic education in many developing countries. This paper shows that these estimates are not reliable for education policy when productivity depends on the proportion of higher educated workers (a productivity externality), and higher educated workers are an input in the production of basic education (a human capital externality). A methodological contribution is describing how the productivity and human capital externalities could be separately identified. Using data on cross-country agricultural productivity gaps, and returns to education for immigrants in the U.S. by country of origin, I show that the productivity and human capital effects of higher educated workers are quantitatively important. The productivity and human capital effects are equal to, and in some cases greater than, the oft-cited difference between estimates of the public-cost-adjusted returns to basic and higher education. For most countries in the dataset, the externalities are large enough to rationalize observed education investments as optimal. The final chapter studies the relative productivities of skilled and unskilled workers across countries. I break down the cross-country ratio of the productivity of skilled to unskilled workers into two components: the human capital embodied in skilled workers, and the physical productivity of skilled and unskilled workers which reflect production techniques. I find that skilled workers from rich countries embody more human capital (compared to poor countries), and skilled workers in rich countries are also more physically productive. This is interpreted as skilled workers from high-income countries being of better quality, and firms in high-income countries adopting more technologies that are skilled-complementary. Furthermore, for most of the 49 countries in my dataset, I find their production techniques to be inappropriate; the estimated physical productivity of skilled workers, relative to the unskilled, is too low given the skilled-unskilled labour ratio. Most countries could increase output by increasing the physical productivity of skilled workers, and decreasing that of unskilled workers. I also find that poorer countries tend to be farther away from their appropriate technologies. I compute 7-fold and 4-fold increases in GDP-per-capita for countries in the 2 lowest income quartiles, just from increasing the relative physical productivity of skilled to unskilled workers. The results suggest large barriers to the adoption of skilled worker complementary technologies, and also present a rationale for why increases in schooling attainment have not led to growth in several countries

Sea Change: The Competing Long-Run Impacts of the Transatlantic Slave Trade and Missionary Activity in Africa

This paper contributes to the debate on the effect of European contact on African societies by comparing the long-run economic impacts of the transatlantic slave trade and historical missionary activity. Recognizing that early missionary activity in Africa was unintentionally aided by the preceding slave trade, it proposes an analytical framework in which the effect of the slave trade was partially mediated by missions. Using unique data from Nigeria, we analyze the causal effects of these shocks on schooling attainment, and consequent effects on literacy rates and self-employment. We �find a total negative effect of the transatlantic slave trade on schooling; its negative direct effect outweighs its positive indirect effect through missionary activity. Missionary activity, on the other hand, has a strong positive direct effect which outweighs the total negative effect of the slave trade. Furthermore, individuals whose ancestors were historically exposed to greater missionary activity are more likely to be literate and less likely to be self-employed, consistent with the positive effect of missionary activity on schooling. In contrast, exposure to the slave trade is associated with lower literacy rates and a greater likelihood of being self-employed. Analyzing the mechanisms, we provide evidence suggesting that the persistent effects of these historical shocks are due to intergenerational factors and higher schooling infrastructure in areas that were less exposed to the slave trade or more exposed to missionary activity. Consistent with a simple theory, these persistent effects are larger for women, younger cohorts, rural residents, and migrants. Religion does not appear to be especially important, and the �findings rule out an explanation based on simple changes in tastes for schooling

Historical Missionary Activity, Schooling, and the Reversal of Fortunes: Evidence from Nigeria

This paper shows that historical missionary activity has had a persistent effect on schooling outcomes, and contributed to a reversal of fortunes wherein historically richer ethnic groups are poorer today. Combining contemporary individual-level data with a newly constructed dataset on mission stations in Nigeria, we find that individuals whose ancestors were exposed to greater missionary activity have higher levels of schooling. This effect is robust to omitted heterogeneity, ethnicity fixed effects, and reverse causation. We find inter-generational factors and the persistence of early advantages in educational infrastructure to be key channels through which the effect has persisted. Consistent with theory, the effect of missions on current schooling is larger for population subgroups that have historically suffered disadvantages in access to education

On the Dispensability of New Transportation Technologies: Evidence from the Heterogeneous Impact of Railroads in Nigeria

Exploring heterogeneity in the impact of a technology is a first step towards understanding conditions under which this technology is conducive to economic development. This article shows that colonial railroads in Nigeria have large long-lasting impacts on individual and local development in the North, but virtually no impact in the South neither in the short run nor in the long run. This heterogeneous impact of the railway can be accounted for by the distance to ports of export. We highlight the fact that the railway had no impact in areas that had access to ports of export, thanks to their proximity to the coast and to their use of waterways, and that those areas barely adopted the railway as it did not reduce their shipping costs. Our analyses rule out the possibility that the heterogeneous impacts are driven by cohort effects, presence of major roads, early cities, or missionary activity, or by crude oil production

On the Dispensability of New Transportation Technologies: Evidence from Colonial Railroads in Nigeria

We examine Fogel's influential hypothesis that new transportation technologies may be dispensable if pre-existing technologies are viable or can simply be improved. Exploiting the construction of colonial railroads in Nigeria, we find that the railway has large long-lasting impacts on individual and local development in the North, but virtually no impact in the South neither in the short run nor in the long run. This heterogeneous impact of the railway can be accounted for by the level of pre-railway access to ports of export. Consistent with Fogel's argument, the railway did not transform areas that had viable transportation alternatives for exporting purposes. Using information on changes in shipping costs and quantities, we highlight the importance of opportunity costs to the adoption and impact of new transportation investments

Historical Missionary Activity, Schooling, and the Reversal of Fortunes: Evidence from Nigeria

This paper shows that historical missionary activity has had a persistent effect on schooling outcomes, and contributed to a reversal of fortunes wherein historically richer ethnic groups are poorer today. Combining contemporary individual-level data with a newly constructed dataset on mission stations in Nigeria, we find that individuals whose ancestors were exposed to greater missionary activity have higher levels of schooling. This effect is robust to omitted heterogeneity, ethnicity fixed effects, and reverse causation. We find inter-generational factors and the persistence of early advantages in educational infrastructure to be key channels through which the effect has persisted. Consistent with theory, the effect of missions on current schooling is larger for population subgroups that have historically suffered disadvantages in access to education

Education for Control and Liberation in Africa and among the Black Diaspora

We review research on the history of education policy in colonial sub-Saharan Africa and among the African Diaspora in the United States and Brazil through a political economy lens. While the supply of education was severely constricted in all of these cases, demand for education remained strong. Thus, even as authoritarian states have attempted to restrict educational supply for social control, the strength of the demand—and the accompanying pedagogical, organizational, and political innovations—illustrates the power of education to empower marginalized communities. Through reviewing work in economics, history, and political science, we highlight the transformative effects of formal education in Black communities as well as the centrality of Black people in demanding access to higher education and innovating new political ideas and pedagogies that saw education as a force for liberation. Governments and citizens must continue to work to correct the inherited distortions in the supply of education in Black communities in Africa as well as in the diaspora.info:eu-repo/semantics/publishedVersio

Impacts of Political Breaks on Education Policies, Access and Quality in Nigeria (1970 – 2003)

This study examines how the political interruptions in Nigeria between 1970 to about 2003 altered policies, institutional norms, governance structures, and attitudes in the education sector

COVID-19 Learning Losses, Parental Investments, and Recovery: Evidence from Low-Cost Private Schools in Nigeria

Using data from a random sample of schools, this paper studies the extent of learning losses and recovery from COVID-19 pandemic in Africa's most populous country, Nigeria, and provides some evidence that a full recovery is possible through a program designed to slow down the curriculum and cover what was missed during school closures