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Returns to Human Capital in Pakistan: A Gender Disaggregated Analysis

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  • Zafar Mueen Nasir

    (Pakistan Institute of Development Economics, Islamabad.)

Abstract

The impact of human capital variables on the earnings of regular wage employees is explored in this paper. Besides education and experience, literacy index, technical training, and school quality are included in the earning functions estimated for individuals. The credentialist view that education does not improve productivity—that it rather provides positive signals about productivity—is also tested. The results are based on the Pakistan Integrated Household Survey 1995-96 data, which provides information on many aspects of the individual’s characteristics missing in other surveys. The results of the study provide ample evidence in favour of human capital as a productivity-enhancing device for both male and female workers. All human capital variables are found to be statistically significant, having positive magnitude. The diploma effect is not very important for Pakistani workers, as only a few diploma dummies are statistically significant.

Suggested Citation

  • Zafar Mueen Nasir, 2002. "Returns to Human Capital in Pakistan: A Gender Disaggregated Analysis," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 41(1), pages 1-28.
    • Handle: RePEc:pid:journl:v:41:y:2002:i:1:p:1-28
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    File URL: http://www.pide.org.pk/pdf/PDR/2002/Volume1/1-28.pdf
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    3. Jafarey, Saqib & Maiti, Dibyendu, 2015. "Glass slippers and glass ceilings: An analysis of marital anticipation and female education," Journal of Development Economics, Elsevier, vol. 115(C), pages 45-61.
    4. Monazza Aslam, 2006. "Rates of Return to Education by Gender in Pakistan," Economics Series Working Papers GPRG-WPS-064, University of Oxford, Department of Economics.
    5. Muhammad Nauman Malik & Masood Sarwar Awan, 2016. "Analysing Econometric Bias and Non-linearity in Returns to Education of Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 55(4), pages 837-851.
    6. Farhan Sami Khan & Imran Ashraf Toor, 2003. "Changes in Returns to Education in Pakistan: 1990-2002," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 8(2), pages 85-98, Jul-Dec.
    7. Safana, Shaheen & Masood, Sarwar & Muhammad, Waqas & Amir, Aslam, 2012. "Economic Analysis of Earnings in Pakistan: A Case of Sargodha District," MPRA Paper 41923, University Library of Munich, Germany.
    8. Madeeha Gohar Qureshi, 2012. "The Gender Differences in School Enrolment and Returns to Education in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 51(3), pages 219-256.
    9. Abrar ul haq, Muhammad & Mehtab, Nadia & Khan, Tasneem, 2012. "Gender Disparity in Economic Returns to Higher Education: Evidence from Private Formal Sector of Bahawalpur (Pakistan)," MPRA Paper 62958, University Library of Munich, Germany, revised 2012.
    10. Shujaat Farooq, 2015. "Job Mismatches in Pakistan: Is there Some Wage Penalty to Graduates?," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 54(2), pages 147-164.
    11. Mlacha, Cornel J. & Ndanshau, Michael O.A, 2018. "Education and Labour Earnings Inequality in Tanzania: Evidence from Quantile Regression Analysis," MPRA Paper 89173, University Library of Munich, Germany.
    12. Durdana Qaiser Gillani & Karamat Ali, 2013. "Employment status and earning functions in urban informal sector : A case of Southern Punjab, Pakistan," Pakistan Journal of Applied Economics, Applied Economics Research Centre, vol. 23(2), pages 97-113.
    13. Ghulam Mustafa, 2023. "Is the Decision to Obtain Higher Education in Pakistan Worth Repaying? New Evidence from Returns on Education for Paid-Employees," PIDE-Working Papers 2023:6, Pakistan Institute of Development Economics.
    14. Muhammad Zahir Faridi & Ayesha Rashid, 2014. "The Correlates of Educated Women’s Labor Force Participation in Pakistan: A Micro-Study," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 19(2), pages 155-184, July-Dec.

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