Macroeconomic Effects of ‘Free’ Secondary Schooling in the Developing World

Junichi Fujimoto, David Lagakos and Mitchell VanVuren

No 31029, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper studies the macroeconomic effects of publicly funded (‘free’) secondary schooling in the developing world. Our analysis is based on an over-lapping generations model of human capital accumulation that we estimate to match experimental evidence on the effects of scholarships for poor but talented students in Ghana. The model predicts that nationwide free secondary schooling increases average education levels but reduces GDP per capita in the long run. The human capital gains from free schooling in the model are offset by lost income during schooling years, negative selection of new students, and reductions in fertility by high-ability households.

JEL-codes: E24 O11 (search for similar items in EconPapers)
Date: 2023-03
New Economics Papers: this item is included in nep-dge
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