Measuring Human Capital in Middle Income Countries (News and Research 296)

World Bank board approves $1.49 billion in new funds for Ukraine | The World Bank’s executive board approved $1.49 billion of additional financing for Ukraine on Tuesday to help pay wages for government and social workers, expanding the bank’s total pledged support to over $4 billion. The World Bank said in a statement that the latest funding is supported by financing guarantees from Britain, the Netherlands, Lithuania and Latvia. The project is also being supported by parallel financing from Italy and contributions from a new Multi-Donor Trust Fund. The World Bank has been working with donor countries to use its various financing programs to support health care, education, social services, power and water supplies and roads.

Measuring human capital in middle income countries | An indicator to measure human capital in middle income countries is applied to Europe and Central Asia, by extending the Human Capital Index to include tertiary education and adult health risk factors. It is found that children born today in the average country in Europe and Central Asia will be almost half as productive as they would have had they reached the benchmark of complete education and full health. Tertiary degree attainment is loosely correlated with the quality of tertiary education. Countries with good basic education outcomes do not necessarily have good higher education outcomes, and high prevalence of adult health risk factors can offset good education indicators.

Kyrgyz: Chairman of Cabinet Akylbek Zhaparov promises not to spare money for education and healthcare | In the next 30 years, the state will not spare money for education and health care. This was announced at the forum “Migration and Development: Prospects and New Opportunities” by the Chairman of the Cabinet of Ministers Akylbek Zhaparov. According to him, Kyrgyz youth should be competitive, have skills that are in demand in the big world, and it is desirable to know English in order to work around the world while living in Kyrgyzstan.

Climate change is harder on less educated people | And covid learning loss has made them even more vulnerable | The importance of education in grappling with climate change is underappreciated. A bit of learning can help people adapt; its absence leaves them vulnerable. Whether Earth warms a little or a lot, people will have to change how they live and work. Better-educated folk have more access to information, such as early warnings for storms or droughts.

Investing in the Next Generation: The Long-Run Impacts of a Liquidity Shock | How do poor entrepreneurs trade off investments in business enterprises versus children’s human capital, and how do these choices influence intergenerational socio-economic mobility? To examine this, we exploit experimental variation in household income resulting from a one-time relaxation of household liquidity constraints, and track schooling and business outcomes over the subsequent 11 years. On average, treatment households, who were made wealthier through the experiment, increase human capital investment such that their children are 35% more likely to attend college. However, schooling gains only accrue to children with literate parents, among whom college attendance nearly doubles. In contrast, treatment effects on investment among the illiterate accrue only on the business margin and are accompanied by adverse educational outcomes for children. As a result, treatment lowers relative educational mobility. In a forecasting exercise, we find that earnings gains for literate households are four times larger than the earnings gains for illiterate households, raising earnings inequality. Our findings highlight how parental investment choices can contribute to a growth in intergenerational earnings inequality despite reductions in urban poverty.

Helping Struggling Students and Benefiting All: Peer Effects in Primary Education | We exploit the randomized evaluation of a remedying education intervention that improved the reading skills of low-performing third grade students in Colombia, to study whether providing educational support to low-achieving students affects the academic performance of their higher-achieving classmates. We find that the test scores of non-treated children in treatment schools increased by 0.108 of a standard deviation compared to similar children in control schools. We interpret the reduced-form effect on higher-achieving students as a spillover effect within treated schools. We then estimate a linear-in-means model of peer effects, finding that a one-standard-deviation increase in peers’ contemporaneous achievement increases individual test scores by 0.679 of a standard deviation. We rule out alternative explanations coming from a reduction in class size. We explore several mechanisms, including teachers’ effort, students’ misbehavior, and peer-to-peer interactions. Our findings show that policies aimed at improving the bottom of the achievement distribution have the potential to generate social-multiplier effects that benefit all.

Lessons from integrating Syrian refugees in the Greek labor market | The Syrian refugee crisis is now seven years old. During the first couple of years, Turkey and Greece were primarily considered major transit countries due to their geographic location. However, the closure of the Western Balkan route and the EU-Turkey Statement gradually transformed both countries from transit gateways to refugee destinations. With this shift, the focus of the refugee policy response in these countries has also changed, expanding the focus from humanitarian support towards longer-term development solutions.

Returns to Different Postsecondary Investments: Institution Type, Academic Programs, and Credentials | Early research on the returns to higher education treated the postsecondary system as a monolith. In reality, postsecondary education in the United States and around the world is highly differentiated, with a variety of options that differ by credential (associates degree, bachelor’s degree, diploma, certificate, graduate degree), the control of the institution (public, private not for-profit, private for-profit), the quality/resources of the institution, field of study, and exposure to remedial education. In this Chapter, we review the literature on the returns to these different types of higher education investments, which has received increasing attention in recent decades. We first provide an overview of the structure of higher education in the U.S. and around the world, followed by a model that helps clarify and articulate the assumptions employed by different estimators used in the literature. We then discuss the research on the return to institution type, focusing on the return to two-year, four-year, and for-profit institutions as well as the return to college quality within and across these institution types. We also present the research on the return to different educational programs, including vocational credentials, remedial education, field of study, and graduate school. The wide variation in the returns to different postsecondary investments that we document leads to the question of how students from different backgrounds sort into these different institutions and programs. We discuss the emerging research showing that lower-SES students, especially in the U.S., are more likely to sort into colleges and programs with lower returns as well as results from recent U.S.-based interventions and policies designed to support success among students from disadvantaged backgrounds. The Chapter concludes with some broad directions for future research.

Job training through turmoil | We follow the labor market outcomes of applicants who were randomized into job training in Colombia a year and a half before the pandemic through the subsequent economic turmoil that resulted from COVID-19. Despite persistently improved labor market outcomes of training participants prior to March 2020, we show that job losses resulting from the pandemic washed away all the benefits of the program. A year and a half after the initial scars of the pandemic, there are no visible signs of the labor market benefits reappearing. We show that these effects are likely due to the fact that the training program pushed people into the service sector – the sector hardest hit by the COVID-19 pandemic.

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Events

Education Impacts of the Covid-19 School Closures | Mitigating the Learning Losses Caused by the COVID-19 School Closures | Conference jointly organized by World Bank and IDEA at CERGE-EI | 21 June 2022, 13:00 – 18:00 (Central European Summer Time – UTC +2) | Prague, CERGE-EI (The Schebek Palace, Politických vězňů 7, Prague 1) | Format: Hybrid: online and in-person | Register Now | The objective of this conference is to document the size and determinants of the learning loss brought about by school closures, identify policy options to reverse these losses, and setting the bases of a more resilient education system. The Conference is divided into three parts: (1) An overview of the pre-pandemic global learning crisis and the mechanisms through which this was exacerbated by the COVID-19 pandemic; (2) The elements of a “Learning Recovery Plan” based on recent evidence of interventions that have proven to be effective to improve learning, particularly among disadvantaged students; and (3) Lessons that can be drawn from the COVID-19 pandemic in the road towards the construction of a more resilient, efficient, and equitable education system. The Conference will be concluded by a panel summarizing a call to action. Confirmed speakers: Štěpán Jurajda (Deputy Minister for Science, Research and Innovation of the Czech Republic), Daniel Münich (IDEA at CERGE-EI), Amanda Spielman (Ofsted, UK), Nuno Crato (University of Lisbon), Gunda Tire (Education and Youth Board of Estonia), Maciej Jakubowski (University of Warsaw), Lenora Chu (Christian Science Monitor), Vaclav Korbel (IDEA at CERGE-EI). Thierry Rocher (Ministère de l’éducation nationale and Université Paris X Nanterre), Hjalte Meilvang (Ministry of Education, Denmark); Alina Sava, Rafael de Hoyos, Polina Zavalina, Tigran Shmis, Harry Patrinos (World Bank).

17th Edition of the International Conference I 28-30 June 2022 | The Faculty of Economic Sciences of the University of Warsaw and the Center for Economic Analysis – CENEA | Warsaw International Economic Meeting” , which will be held in a full-time form, on June 28-30, 2022 at the University of Warsaw | Keynote Speakers: Anna Aizer (Brown University); Daniel Hamermesh (University of Texas at Austin and IZA Bonn); Harry Anthony Patrinos (World Bank)