The Social Outcomes of Education and Feedbacks on Growth in Africa

Most of the effects of education included in the complete model presented here are shown to be consistent with those found in the mainstream of the research on each outcome using microeconomic data. This, however, is a first effort to estimate net education effects more comprehensively, beyond just growth and health effects on other key measures of development in Africa, and also a new view of indirect feedbacks on economic growth and of externalities. After developing the conceptual framework, the regression estimates are presented together with a discussion of the net direct and indirect effects of education on each outcome. These are shown to improve infant mortality, increase longevity, strengthen civic institutions and democratisation, increase political stability, and increase investment in physical capital, which in turn have positive delayed feedback effects on the economic growth process. The effects also lower fertility rates and population growth rates but the latter occurs only after long delays because of the short-term positive effects of education on health. There are significant net education effects reducing poverty, inequality and crime, the latter after netting out negative externalities from growth and white-collar crime. Education effects reducing poverty and substituting skills for extractive exports also contribute to environmental sustainability. Simulations solve the complete model endogenously and iteratively over time for all of the direct and indirect (largely externality) effects. They reveal that indirect feedback effects including those on non-market outcomes are larger than the direct effects. Some effects are immediate, but many of the lags are long. So policy options for a continent in crisis that consider these lags are considered.