EDUCATIONAL ATTAINMENT AND THE RURAL-URBAN DIVIDE IN CHINA

A national household income survey and census data are used to examine the determinants of educational attainment in China. Rural and urban areas are analysed separately, and contrasted, owing to the sharp economic and institutional divide between them. The roles of income, age, gender, ethnicity, region and family background are explored. An attempt is made to distinguish between demand- and supply-constraints. The opportunity and other costs of rural schooling, and the reasons for leaving school, are examined. Income levels and incentives are important in explaining rural dropping out, and parental education is a powerful influence on enrolment and achievement. The considerable inequality of educational opportunity in China requires corrective policies.     

MATERNAL EDUCATION AND CHILD ATTAINMENT IN JAMAICA: TESTING THE BARGAINING POWER HYPOTHESIS†

In a bargaining model of household decision-making, any variable reflecting the outside opportunities of household members will influence household demand patterns. Mother's education has been found to be an important determinant of children's education and health outcomes. This paper argues that within a bargaining framework, mother's education may influence children's health and education by shifting bargaining power within the household. An empirical strategy is developed and applied to data on teenage grade attainment and school enrolment in Jamaica. The results support the bargaining power hypothesis, and imply a broader role for mother's education than has previously been considered.     

CREDIBLY IDENTIFYING SOCIAL EFFECTS: ACCOUNTING FOR NETWORK FORMATION AND MEASUREMENT ERROR

Understanding whether and how connections between agents (networks) such as declared friendships in classrooms, transactions between firms, and extended family connections, influence their socio‐economic outcomes has been a growing area of research within economics. Early methods developed to identify these social effects assumed that networks had formed exogenously, and were perfectly observed, both of which are unlikely to hold in practice. A more recent literature, both within economics and in other disciplines, develops methods that relax these assumptions. This paper reviews that literature. It starts by providing a general econometric framework for linear models of social effects, and illustrates how network endogeneity and missing data on the network complicate identification of social effects. Thereafter, it discusses methods for overcoming the problems caused by endogenous formation of networks. Finally, it outlines the stark consequences of missing data on measures of the network, and regression parameters, before describing potential solutions.     

EFFECTS OF HIV/AIDS ON CHILDREN'S EDUCATIONAL ATTAINMENT: A SYSTEMATIC LITERATURE REVIEW

Over the last three decades, 35 million people have died of AIDS. As a result, HIV/AIDS has brought about a significant reduction in human capital, especially in sub-Saharan Africa. Several studies have examined the effects of HIV/AIDS on human capital, in particular educational attainment. These studies have examined different countries, datasets, and educational outcomes. This systematic literature review provides a comprehensive up-to-date overview of peer-reviewed papers published in English by focusing on the main mechanisms that influence the effects of HIV/AIDS on educational outcomes. These are sickness of the child, orphanhood, and sickness of parents. The results show that educational outcomes of HIV-infected children, AIDS orphans, and children with HIV-infected parents are affected differently. HIV-infected children mainly miss school days due to illness and medical appointments, and orphans mainly face financial problems and lack motivation in their education, while children with HIV-infected parents may have to take care of their sick parents or face financial problems that affect their education. Distinguishing these groups of children could help to formulate policies that adequately improve schooling outcomes of these vulnerable children.     

REALITIES OF HEALTH POLICY IN NORTH AMERICA: GOVERNMENT IS THE PROBLEM,NOT THE SOLUTION

Healthcare systems in North America are sometimes criticised as being expensive or socially irresponsible relative to comparable systems in OECD (Organisation for Economic Co‐operation and Development) countries or regions. These perceived health system failures are often mistakenly attributed to greater private sector involvement in the delivery of medical care or the provision of medical insurance in Canada and the USA. However, the exact nature and scope of state involvement in the healthcare sector in Canada and the USA is also often misunderstood and underestimated. This paper presents a fact‐based context for evaluating health policy in North America.     

THE DISTRIBUTION OF WEALTH: MEASUREMENT AND MODELS

Abstract. Analysts debating the consequences of a policy change for the wealth distribution may come to different conclusions because of different views about how the distribution should be defined and measured, or about the processes determining the distribution. The aim of this survey is to provide an analytical framework within which such conflicts may be assessed. The first part of the paper discusses conceptual issues in the definition of 'wealth', and compares methods of deriving estimates of wealth distribution. The second, and larger, part of the paper surveys lifecycle and intergenerational models of the distribution of wealth, including a discussion of the role played by inheritance. The presentation is largely theoretical. Indeed, one of the paper's conclusions is that empirical modelling of the wealth distribution is under-developed, at least for the purposes of addressing many topical policy issues.     

MANAGING THE DEBT PROBLEM: HISTORICAL PARALLELS AND CONTEMPORARY POLICY

Books reviewed in this article:
Barry Eichengreen & Peter H. Lindert (Eds.) (1989) The International Debt Crisis in Historical Perspective.
Jeffrey D. Sachs (Ed.) (1989) Developing Country Debt and Economic Performance.
Graham Bird (Ed.) (1989) Third World Debt: The search for a solution.     

THE MEASUREMENT OF ABSORPTIVE CAPACITY FROM AN ECONOMICS PERSPECTIVE: DEFINITION,MEASUREMENT AND IMPORTANCE

This paper starts by recognizing that despite the importance of absorptive capacity, economists in particular have made only limited use of the concept. Most theoretical and empirical studies derive from other fields of research. Thus, the first task is to compare and contrast the different approaches taken in measuring absorptive capacity. The rest of the paper then sets out an example of how typically economists have proceeded, using nationally representative CIS data to measure absorptive capacity across a 10‐year period and investigating if it remains stable in the long term. This is followed by considering how firms’ characteristics vary across lower to higher levels of absorptive capacity and whether such capacity determines firms’ productivity performance across both goods and service industries. Our results show that relative to other influences, absorptive capacity as measured here — net of the impact of foreign‐ownership and human capital — has a substantial influence on exporting, innovation and undertaking R&D and thus consequently firm‐level productivity. Finally, there is a discussion of why governments should consider helping firms to boost their levels of absorptive capacity.     

EDUCATIONAL EXPANSION: THE WORMS IN THE APPLE

Expansion of higher education can undermine rather than enhance the value of education for low income families. Less well qualified children of higher income families are the main beneficiaries of the expansion and the value of the qualifications of those who do not participate in higher education can be undermined. The most obvious practical policy that would expand educational opportunity for all would be to treat all adult students equally and give further education institutions and universities comparable, as well as greater, freedom from government control.     

THE ECONOMICS OF HEALTH AND SAFETY AT WORK: AN INTERDICIPLINARY REVIEW OF THE THEORY AND POLICY

Abstract This paper engages in an interdisciplinary survey of the current state of knowledge related to the theory, determinants and consequences of occupational safety and health (OSH). It first describes the fundamental theoretical construct of compensating wage differentials, which is used by economists to understand the optimal provision of OSH in a perfectly competitive labour market. The plethora of incentives faced by workers and firms in job and insurance markets that determine the ultimate level of OSH are discussed in detail. The extensive empirical evidence from the hedonic wage and stated choice approaches used to assess the value of OSH is reviewed. The causes of inefficiency and inequity in the market for OSH, such as externalities, moral hazard in compensation insurance, systematic biases in individual risk perception/well‐being and labour market segregation are subsequently examined. The implications of government intervention and regulation for tackling the aforementioned inefficiencies in OSH are then considered. Finally, the survey identifies areas of future research interests and suggests indicators and priorities for policy initiatives that can improve the health and safety of workers in modern job markets.     

EXPERTISE AND PROBLEM CATEGORIZATION: THE ROLE OF EXPERT PROCESSING IN ORGANIZATIONAL SENSE-MAKING

Our purpose is to understand more fully the role of managerial cognition in organizations. As such, we adopted an experimental approach in studying the use of expert processing in the categorization of organizational problems. We compared the problem categories of 38 chief executive officers (CEOs) in the machine tool industry (experts) with those of 30 MBA students (novices). The results of a problem sorting task indicated that experts tended to categorize the ill-structured problems significantly faster than novices. Experts also had greater variance in the number of categories used and they incorporated more problem information. Follow-up analyses revealed that the number of categories was negatively related to experts’age and positively related to the number of processes and services offered by their respective organizations. These findings are consistent with the contention that experts rely on well-developed, context-dependent heuristics in the early stages of their decision-making. It is argued that such heuristics allow organizational experts to make sense of strategic issues quickly, and respond in an efficient and effective manner.