Gender and education : a microeconometric analysis of returns to education in Nigeria

By revisiting the long-standing discourse on the economic value of education, this thesis investigates whether education continues to pay off despite persistent gender wage differentials in Nigeria’s segmented labour market. Using a household-level cross-sectional micro dataset from the Living Standards Measurement Survey 2018/19, gender wage differentials are analysed in two ways. First, through the lens of returns to education by employing a multi-method strategy. This involves applying the Mincerian model as a benchmark strategy, the Heckman model to correct for sample selection bias, and the Instrumental Variable model, using distance to the nearest primary and secondary schools as instruments, to accurately estimate returns. Second, by applying the Oaxaca-Blinder decomposition, which relies on the Re-Centred Influence Function (RIF) regression, the wages of men and women across formal and informal sectors are decomposed to further examine the extent of discrimination at several quantile points along the wage distribution. The findings unveil the role of sectoral contexts in shaping returns by gender. For men, estimated returns are substantially larger in the informal sector, at 17.5%, compared to the formal sector at 5.8%. Low returns in the formal sector reflect a sorting behaviour where highly skilled men exit the labour market due to institutional constraints, including wage compression and the emigration of skilled labour. The pull factors, such as higher marginal returns in the informal sector, further strengthen this sorting behaviour. Meanwhile, the high returns for women across both sectors imply that women receive better rewards for their stock of human capital. The decomposition results provide evidence of a sticky floor effect where women at the 10th and 20th quantiles face the most significant disadvantage in the formal sector. While in the informal sector, an inverted U-shaped pattern in the total wage gap shows that at all points along the wage distribution, discrimination remains positive. The unexplained component dominates the gap, implying that gender constraints and discriminatory practices in the informal sector contribute to this gap. These insights highlight the need for labour market policies that aim to reduce gender-based discrimination and enhance wage structures, particularly for women in the formal sector. Similarly, measures of incentivising skilled workers to retain them in the formal economy while formalising high-return profit-generating activities would enhance national productivity and promote equitable economic growth.

Grantor dc:publisher

Oxford Brookes University

Author dc:creator

• Yakubu, Amina Mahmood

Contributors dc:contributor

• Himaz, Rozana Salih
• Asteriou, Dimitrios
• Osman, Rehab

Statement dc:rights

• All rights reserved

Language dc:language

en

DOI dc:identifier

https://doi.org/https://doi.org/10.24384/es77-3f98

OAI identifier oai:identifier

tle:2b8fb86b-ac30-4345-86b4-66e51ccd2e84:d6bd9758-527a-46cd-bfe2-c433766e8fca:1