Literacy Traps: Society-wide Education and Individual Skill Premia

Vidya Atal, Kaushik Basu, John Gray () and Travis Lee
Additional contact information
John Gray: Cornell University

No 4047, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Using a model of O-ring production function, the paper demonstrates how certain communities can get caught in a low-literacy trap in which each individual finds it not worthwhile investing in higher skills because others are not high-skilled. The model sheds light on educational policy. It is shown that policy for promoting human capital has to take the form of a mechanism for solving the coordination failure in people’s choice of educational strategy.

Keywords: O-ring; literacy; education; skill formation; traps (search for similar items in EconPapers)
JEL-codes: D20 I28 J31 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2009-02
New Economics Papers: this item is included in nep-dev, nep-edu, nep-hrm and nep-lab
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Published - published in: IJET International Journal of Economic Theory, 2010, 6 (1), 137-148

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https://docs.iza.org/dp4047.pdf (application/pdf)

Related works:
Journal Article: Literacy traps: Society‐wide education and individual skill premia (2010)
Working Paper: Literacy Traps: Society-Wide Education and Individual Skill Premia (2009)
Working Paper: Literacy Traps: Society-wide Education and Individual Skill Premia (2009)
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