The Impact Of School Quality On Earnings In Ghana

Abstract

This study examines the role of school quality in Ghana (measured by pupil-teacher ratios and percentage of trained teachers in basic schools), and how it affects earnings of workers in Ghana by identifying the variations in school quality across the country. The Mincer earnings equation is modified to include school quality and other variables and employed to show the relationship with earnings. The study uses secondary data from the sixth round of the Ghana Living Standard Survey and Ghana Ministry of Education. Results from the study reveal a significant relationship between school quality variables and the earnings of workers in Ghana. There are also variations in school quality across the country. After obtaining the Ordinary Least Square estimates, school quality represented by pupil-teacher ratios (PTR) and percentage of trained teachers (PTT) suggest that individuals educated in regions with better quality schooling( i.e, higher percentage of trained teachers and lower pupil-teacher ratios) earn significantly more than those educated in regions with lower quality schooling. This is thus consistent with findings of Bedi and Edwards (2001) and Godana and Ashipala (2006). Using parents‟ years of education as instruments with a sample size of 9219 workers, the Instrumental Variables estimates suggest that the impact of school quality on earnings is significant for the percentage of trained teachers measure of school quality. Pertaining to gender, pupil-teacher ratio has a significant impact on male workers whereas percentage of trained teachers has a significant impact on female workers. This suggests that males educated in regions with lower pupil-teacher ratios earn significantly more than males educated in regions with higher pupil-teacher ratios. Females also educated in regions with higher percentage of trained teachers earn significantly more than females educated in regions with low percentage of trained teachers.