Education Is Good for the Poor
a Note on Dollar and Kraay (2001)
A recent paper by Dollar and Kraay (2001) finds that higher primary educational attainment of the workforce does not increase the income of the poor except for its effect on average income. We test the robustness of their finding by using a broader measure of human capital that accounts for international differences in the quality of education. Our findings suggest that more quality-adjusted education does increase the income of the poor in addition to its positive effect on average income. Hence effective education policies should be an essential component of any poverty-reduction strategy.