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| Title: | Education, Job Signaling, and Dual Labor Markets in Developing Countries |
| Authors: | Kim, Sunwoong
Mohtadi, Hamid |
| Issue Date: | 1992 |
| Series/Report no.: | Bulletin 92-1 |
| Abstract: | An overlapping generational model of educational investment in a dual
labor markets is presented in which education serves both as a
screening device and as investment in human capital. Labor market
dualism arises not only via the conventional technology (productivity)
differential between a primary and a secondary sector, but also by a
higher than a labor market clearing wage in the primary sector, to
insure no shirking by the workers (an element shared with the
efficiency wage theories). The important determinants of the workers'
educational investment decision are the degree of discipline in the
labor market and the cost of education. Among the three most commonly
discussed educational policies of maximizing the number of the
educated, maximizing the primary sector employment and maximizing
social welfare, the last one, i.e., the most efficient one, leads to a
lower level of education subsidy by the government. |
| URI: | http://purl.umn.edu/7503 |
| Institution/Association: | University of Minnesota>Economic Development Center>Bulletins |
| Total Pages: | 32 |
| Language: | English |
| Collections: | Bulletins
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