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Lost in Transition? Declining Returns to Education in Vietnam

Tinh Doan, Tuyen Tran and Le Quan ()
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Le Quan: VNU University of Economics and Business

Working Papers in Economics from University of Waikato

Abstract: There is evidence of a rapid increase in the returns to education in Vietnam in the 1990s and 2000s. There was a substantial change in education policy in the 2000s, especially opening up education opportunities for education providers to expand educational facilities and training. These changes could lead to a decline in the returns to education. To provide up-to-date estimates of the returns, we re-visit the returns using updated large-scale survey data to 2014. We apply the Heckman selection estimators to correct for selection bias and find that the return to education in Vietnam increased quickly up to the global financial crisis in 2008/2009 and declined sharply thereafter. This raises at least two questions: is the higher-educated labour force oversupplied or is there a large distortion in the labour market?

Keywords: economic transformation; returns to education; education supply; wage setting; Vietnam (search for similar items in EconPapers)
JEL-codes: C52 I26 J21 J31 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2016-03-07
New Economics Papers: this item is included in nep-edu, nep-sea and nep-tra
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Journal Article: Lost in Transition? Declining Returns to Education in Vietnam (2018) Downloads
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