Open AccessSchooling is Associated not only with Long-run Wages, but also with Wage Risks and Disability Risks: The Pakistani Experience.
Author(s) -
Asma Hyder,
Jere R. Behrman
Publication year - 2011
Publication title -
pakistan development review
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.154
H-Index - 26
ISSN - 0030-9729
DOI - 10.30541/v50i4iipp.555-573
Subject(s) - wage , economics , labour economics , educational attainment , wage growth , demographic economics , work (physics) , developing country , economic growth , mechanical engineering , engineering
Many studies document significantly positive associationsbetween schooling attainment and wages in developing countries. But whenindividuals enter occupations subsequent to completing their schooling,they not only face an expected work-life path of wages, but a number ofother occupational characteristics, including wage risks and disabilityrisks, for which there may be compensating wage differentials. Thisstudy examines the relations between schooling on one hand and meanwages and these two types of risks on the other hand, based on 77,685individuals in the labour force as recorded in six Labour Force Surveysof Pakistan. The results suggest that schooling is positively associatedwith mean total wages and wage rates, but has different associationswith these two types of risks: Disability risks decline as schoolingincreases but wage risks, and even more, wage rate risks increase asschooling increases. The schooling-wage risks relation, but not theschooling-disability risks relation, is consistent with there beingcompensating differentials. JEL classification: J31, J28, O53 Keywords:Wages, Risks, Labour Markets, Job Disabilities, CompensatingDifferentials, Developing Country, Schooling