Improving quality versus increasing the quantity of schooling: Estimates of rates of return from rural Pakistan

Abstract

This paper's approach permits a more satisfactory assessment than previously of the rates of return to improving school quality versus increasing quantity in terms of labor earnings and their implications for educational policy in developing countries. Special data from rural Pakistan collected for this study are used to make estimates within a conceptual framework that controls for important individual and household choices. The results indicate that rates of return were much higher for investing in primary school quality or quantity than for investing in middle schools and, at the primary school level, somewhat higher for expanding low-quality schools than for increasing quality in existing schools.