Wage differentials in Sri Lanka: the case of a post-conflict country with a free education policy. (2015)

• Record Type: Journal Article
• Authors: Kumara, Ajantha Sisira
• Is Part Of: International journal of education economics and development. Volume 6:Number 4(2015)
• Page Start: 343
• Page End: 365
• Publication Date: 2015
• Subjects: free education -- income equality -- household surveys -- instrumental variables -- micro-data -- quantile regression -- returns -- sample selection -- Sri Lanka -- wage rates -- wage differentials -- post-conflict countries -- educational achievement -- earnings -- primary education -- secondary education -- university education -- higher education; Education -- Economic aspects -- Periodicals; 338.473705
• Languages: English
• ISSNs: 1759-5673

Abstract

This study analyses wage differentials in Sri Lanka by the individuals' educational attainment. The wage returns to education are estimated by using a combination of the techniques of ordinary least-square, two-stage least-square, sample-selection, and quantile regression on micro-data of the Sri Lanka Labour Force Survey - 2013. Therefore, the estimates provided by this study are representative of the entire country and corrected for both the endogeniety and the sample-selection biases. The study concludes that education generates a positive impact on private earning. The results show that one additional year of schooling increases the hourly wage rate by 9% approximately. In addition, according to the results, primary and secondary education reduces income inequality among people whereas the bachelor's-degree university education contributes to income inequality. Further, the results relating to the additional controls reveal that the male, urban, and the public sector employees earn relatively higher wage returns.