Simulating the impact of a raise in education salaries on economic growth in Peru

Luciano Paredes Chervellini () and Jo Ritzen ()
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Luciano Paredes Chervellini: UNU-MERIT, Maastricht University, and ComexPeru
Jo Ritzen: UNU-MERIT, Maastricht University

No 2021-029, MERIT Working Papers from United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT)

Abstract: A simulation shows that increasing teacher salaries is likely to be (very) profitable for Peru. The required investments have in the long run a substantial return in economic growth as higher salaries would lead to higher teacher cognitive skills, which in turn impact student achievement. We suggest that international development banks should develop products for education finance with a long period (60 years or more) before repayments must be made.

Keywords: Education; Return over investment; Economic growth; GDP; PISA; Cognitive Skills; Teachers; Development finance (search for similar items in EconPapers)
JEL-codes: C63 H52 I25 N36 O15 O21 O24 (search for similar items in EconPapers)
Date: 2021-07-06
New Economics Papers: this item is included in nep-gro and nep-his
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