Estimates of Mincerian Returns to Schooling in Nigeria

Abstract

In the face of declining rates of primary and secondary school enrolment and increasing post-secondary school enrolment rates, the Nigerian government introduced the free universal basic education programme in 1999. To understand better the economic forces underlying the recent trends in school enrolment rates and appraise the new education policy from the perspective of private efficiency returns, I estimate the private returns to schooling associated with levels of educational attainment for wage and self-employed workers using data from the General Household Survey. The estimates for both men and women are small at primary and secondary levels, 2–3% and 4%, respectively, but are substantial at post-secondary education level, 10–15%. Inter-generational returns to schooling decline for primary education but rise for post-secondary education. These schooling return estimates may account for the recent trends in school enrolments. Thus, increasing public investment to encourage increased attendance in basic education is not justifiable on grounds of private efficiency, unless investments to increase school quality have higher private returns. With high private returns to post-secondary schooling, students at this level should pay tuition to recoup more of the public costs of schooling, which may be redistributed to poor families through scholarships.