World Development Report 2018: Learning to Realize Education’s Promise

Education is a basic human right, and it is central to the potential to reach them. These benefits are both unlocking human capabilities. It also has tremendous monetary and nonmonetary for individuals, families, instrumental value. Education raises human capital, communities, and society as a whole (table 1.1).

productivity, incomes, employability, and economic

Most people—whether policy makers or parents— growth. But its benefits go far beyond these monalready recognize the great value of education.

etary gains: education also makes people healthier

Families around the world make great sacrifices to and gives them more control over their lives. And it keep their children in good schools, and political and generates trust, boosts social capital, and creates instiopinion leaders consistently rank education among tutions that promote inclusion and shared prosperity.

their top development priorities. For that reason, this chapter does not try to review all the evidence on the benefits of education. But before launching into the

Education as freedom

main theme of this Report—the learning crisis and

Since 1948, education has been recognized as a basic what to do about it—it is worth surveying briefly human right, highlighting its role as a safeguard for the many ways in which education can contribute human dignity and a foundation of freedom, justice, to progress, highlighting that these benefits often and peace. In the language of Amartya Sen’s capabildepend on learning, not just schooling.

ity approach, education increases both an individual’s assets and his or her ability to transform them into well-being—or what has been called the individual’s “beings and doings” and “capabilities.” Education can have corresponding salutary effects on communities and societies.

Education expands freedom through many

Education is a powerful tool for raising incomes.

channels, both raising aspirations and increasing

Education makes workers more productive by giving them the skills that allow them to increase their out-less educated workers to lose their jobs, and if they do put. Each additional year of schooling typically raises they are more likely to find another job. Educated workan individual’s earnings by 8–10 percent, with larger ers are more attached to the firms they work for. They increases for women (figure 1.1). This is not just are also more effective at acquiring and processing because higher-ability or better-connected people job search information. Research in Finland and the (who would earn more regardless of their schooling)

United States finds that more schooling makes it easreceive more education, as proposed by the signaling ier for unemployed people to find reemployment. In model of education. “Natural experiments” from a less developed economies with large informal sectors wide variety of countries—such as Honduras, Indo- and underemployment, education is associated with nesia, the Philippines, the United Kingdom, and the greater access to full-time jobs in the formal sector.

United States—prove that schooling does drive the increased earnings (box 1.1).

In well-functioning labor markets, education reduces the likelihood of unemployment. In these

Education promotes longer, healthier lives. Around economies, high school graduates are less likely than the world, there are strong links among education, better health outcomes, and longer lives. Regardless of their race, gender, or income, more-educated individuals in Europe and the United States have a lower probability of having a chronic health condition. In the United States, each additional year of schooling is associated with a lower probability of death, especially after high school (figure 1.2). One reason is that education makes people less likely to smoke, drink in excess, be overweight, or use illegal drugs. In the United States, education makes people less likely to smoke; in Uganda, more-educated individuals were more responsive to HIV/AIDS information campaigns.

Educated individuals have more control over the life they want to pursue—often called “agency.” Increased agency manifests itself as a reduction in risky behavior, higher life satisfaction, and greater happiness. Across 52 countries at all income levels in 2010–14, only 1 in 10 university graduates felt that they had little or no control over their lives. When the United Kingdom and the United States extended compulsory schooling, people who received more education were less likely to report being unhappy later in life.

The positive relationship between education and agency is partly mediated by the positive effect of education on income, but there seems to be an independent effect as well: the effects on crime and fertility, for example, are not contingent only on income. Schooling reduces most types of crime committed by adults, as well as crime during late adolescence. Among 16-and 17-year-olds in the United Kingdom, school dropouts are three times more likely to commit crimes than those who have stayed in school, and this gap remains well into their early 20s. In Sweden, the United Kingdom, and the United States, completing high school makes youth less likely to commit crimes, and education is linked with lower crime rates elsewhere—such as in Mexico, where high school dropouts were more caught up in the violence of the war on drugs.

As for fertility, education reduces teen pregnancy and increases the control that women have over the size of their families. Schooling reduces teenage pregnancy indirectly by increasing girls’ aspirations, empowerment, and agency. In Turkey, primary school completion induced by a change in compulsory schooling laws—allowing research to isolate the causal effects—reduced teenage fertility by 0.37 children per woman. School subsidies reduced teen pregnancy (and in some cases school dropout) in Brazil, Colombia, Kenya, Malawi, and Peru. More generally, women with more schooling have lower fertility rates. In Brazil, increased schooling among young women explains 40–80 percent of the decline in the fertility rate that began in the late 1960s. When school coverage expanded in Nigeria, each additional year of female schooling reduced fertility by at least 0.26 births per woman.One reason may be that educated women earn more, making it costlier for them to leave the labor market. Education also increases women’s use of contraception, increases their role in family decisions on fertility, and makes them more aware of the trade-offs in having children.

Education can eliminate poverty in families. The incomes of parents and their children are highly correlated: income inequality persists, and poverty is transmitted from one generation to the next.But improving education gives poor children a boost: in the United States, the children of households that moved to a (one standard deviation) better neighborhood had incomes as adults that were more than 10 percent higher, in part because the move improved learning.

Better-educated mothers raise healthier and more educated children. Women’s education is linked to many health benefits for their children, from higher immunization rates to better nutrition to lower mortality. Improvements in women’s education have been linked to better health outcomes for their children in many countries, including Brazil, Nepal, Pakistan, and Senegal. Parental schooling robustly predicts higher educational attainment for children, even after controlling for other factors. And children’s ability to benefit from education is shaped by their parents’ education. In the United States, each additional year of a mother’s schooling increases her children’s math test scores by 0.1 standard deviation and significantly reduces behavioral problems. In Pakistan, mothers who have one more year of schooling have children who spend an additional hour a day studying at home.

Education’s benefits are especially apparent in changing environments. Individuals with stronger skills can take better advantage of new technologies and adapt to changing work. Indeed, experts on technological change have long argued that the more volatile the state of technology, the more productive education is. Returns to primary schooling in India increased during the Green Revolution, with the more educated farmers adopting and diffusing new technologies. More generally, globalization and advances in technology are putting a premium on education and skills—both cognitive and socioemotional (see spotlight 5). New skills facilitate the adoption of technologies and promote innovation, with general skills enabling individuals to adapt to the economic changes that occur over their lifetimes. When the North American Free Trade Agreement (NAFTA) increased labor productivity in Mexico, the benefits were concentrated among moreskilled workers in the richer northern states. In general, returns to education are higher in economically free countries with institutions that allow individuals to adjust to shocks and market forces.