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  3. American Economic Review
  4. September 2001
  5. Schooling and Labor Market Consequences of School Construction in Indonesia: Evidence from an Unusual Policy Experiment

Schooling and Labor Market Consequences of School Construction in Indonesia: Evidence from an Unusual Policy Experiment

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Abstract

Between 1973 and 1978, the Indonesian government engaged in one of the largest school construction programs on record. Combining differences across regions in the number of schools constructed with differences across cohorts induced by the timing of the program suggests that each primary school constructed per 1,000 children led to an average increase of 0.12 to 0.19 years of education, as well as a 1.5 to 2.7 percent increase in wages. This implies estimates of economic returns to education ranging from 6.8 to 10.6 percent.

Citation

Duflo, Esther. 2001. "Schooling and Labor Market Consequences of School Construction in Indonesia: Evidence from an Unusual Policy Experiment." American Economic Review, 91 (4): 795-813. DOI: 10.1257/aer.91.4.795

JEL Classification

  • I28 Education: Government Policy
  • O15 Economic Development: Human Resources; Human Development; Income Distribution; Migration
  • J31 Wage Level and Structure; Wage Differentials
  • I21 Analysis of Education
  • O22 Project Analysis
  • J24 Human Capital; Skills; Occupational Choice; Labor Productivity