Rozana Himaz

Intrahousehold Allocation of Education Expenditure: The Case of Sri Lanka

This article uses conventional Engel curve demand analysis, as well as a double hurdle model, to explore whether there are intrahousehold differentials in the allocation of education expenditure between boys and girls in rural Sri Lanka. Contrary to the case in most developing countries, in Sri Lanka, there was a significant bias favoring girls for 1990–91 and 1995–96 for age group categories 8–9, 14–16, and 17–19, and in 2000 for age group categories 14–16 and 17–19. Significant differences in enrollment favoring girls aged 17–19 explain part of the girl bias observed in 1990–91 and 2000–2001, but most of the bias is driven by positive expenditure given enrollment. The biases favoring girls are observed at critical stages of the schooling career in the run‐up to key national exams. The 8–9 age group captures the run‐up to the year 5 scholarship exams that are used to gain entry to the better‐performing secondary schools. The 14–16 and 17–19 age groups capture those who read for important national‐level qualifications that are vital for the job market. This article also looks at various possible explanations for the bias.

Returns to education in Sri Lanka: a pseudo-panel approach

This study employs a pseudo-panel approach to estimate the returns to education among income earners in Sri Lanka. Pseudo-panel data are constructed from nine repeated cross sections of Sri Lankas Labor Force Survey data from 1997 to 2008, for workers born during 1953–1974. The results show that for males, one extra year of education increases monthly earnings by about 5% using the pseudo-panel estimation rather than 9% as in the ordinary least-squares (OLS) estimation. This indicates that not controlling for unobservables such as ability and motivation biases the OLS estimation of returns upwards by about 4% on average, driven mainly by what happens in urban areas. It also suggests that males with higher ability seem to be acquiring more years of education. This is contrary to what has been observed recently in countries such as Thailand [Warunsiri, S., and R. McNown. 2010. “The Return to Education in Thailand: A Pseudo-Panel Approach.” World Development 38 (1): 1616–1625], where the opportunity cost of education seems to be high, such that high-ability individuals leave education for the labour market.

Schooling and household welfare: The case of Sri Lanka from 1990 to 2006

This paper looks at the effect schooling has had on household welfare in Sri Lanka during the 1990–2006 period, on average and across the welfare distribution. We account for the endogeneity of schooling using quantile instrumental variable estimation as developed in Chernozhukov, FernAindez†Val, and Kowalski (). We use pooled data from four cross†sectional Household Income Expenditure Surveys. The results show that an extra year of schooling on the part of the most educated adult member in the household can increase welfare (proxied by real per capita consumption expenditure) by 3.8 percent on average. However, the effect varies considerably across the welfare distribution: At the lower end, around the 20th and 25th quantiles, an extra year of education increases welfare by 6 and 5 percent, respectively, while at the median it is around 3.5 percent. At the higher, 90th quantile it is much less, at 1 percent. Thus the marginal effect of schooling on welfare is significant and positive at all levels of the welfare distribution, but highest at the lower and middle quartiles. This result is different from findings in the literature that tend to show larger effects at higher quantiles, when endogeneity is uncorrected.