The Rural-Urban Divide and Intergenerational Educational Mobility in a Developing Country : Theory and Evidence from Indonesia
This paper provides an analysis of the rural-urban divide in intergenerational educational mobility in Indonesia with two distinguishing features. First, the estimating equations are derived from theory incorporating rural-urban differences in retu...
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World Bank, Washington, DC
2020
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| Online Access: | http://documents.worldbank.org/curated/en/414131604430277237/The-Rural-Urban-Divide-and-Intergenerational-Educational-Mobility-in-a-Developing-Country-Theory-and-Evidence-from-Indonesia http://hdl.handle.net/10986/34731 |
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okr-10986-347312022-09-20T00:11:15Z The Rural-Urban Divide and Intergenerational Educational Mobility in a Developing Country : Theory and Evidence from Indonesia Ahsan, Md Nazmul Emran, M. Shahe Shilpi, Forhad INTERGENERATIONAL MOBILITY RURAL-URBAN DIVIDE URBANIZATION RETURNS TO EDUCATION COMPLEMENTARITY SCHOOL QUALITY ROLE MODEL This paper provides an analysis of the rural-urban divide in intergenerational educational mobility in Indonesia with two distinguishing features. First, the estimating equations are derived from theory incorporating rural-urban differences in returns to education and school quality, and possible complementarity between parent’s education and financial investment. Second, the data are suitable for tackling the biases from sample truncation due to coresidency and omitted cognitive ability heterogeneity. The evidence rejects the workhorse linear intergenerational educational persistence equation in favor of a convex relation in rural and urban Indonesia. The rural-urban relative mobility curves cross, with the children of low educated fathers enjoying higher relative mobility in rural areas, while the pattern flips in favor of the urban children when the father has more than nine years of schooling. However, the rural children face lower absolute mobility across the whole distribution of father's schooling. Estimates from the investment equation suggest that, in urban areas, children~^!!^s peers are complementary to financial investment by parents, while the adult role models are substitutes. In contrast, separability holds in villages. Peers and role models are not responsible for the convexity in both rural and urban areas, suggesting more efficient investment by educated parents as a likely mechanism, as proposed by Becker et al. (2015, 2018). The theoretical relation between the intercepts of the mobility and investment equations helps in understand whether school quality is complementary to or a substitute for parental financial investment. This paper finds evidence of substitutability, implying that public investment to improve the quality of rural schools is desirable on both equity and efficiency grounds. 2020-11-05T15:39:01Z 2020-11-05T15:39:01Z 2020-11 Working Paper http://documents.worldbank.org/curated/en/414131604430277237/The-Rural-Urban-Divide-and-Intergenerational-Educational-Mobility-in-a-Developing-Country-Theory-and-Evidence-from-Indonesia http://hdl.handle.net/10986/34731 English Policy Research Working Paper;No. 9464 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper East Asia and Pacific Indonesia |
| repository_type |
Digital Repository |
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Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
INTERGENERATIONAL MOBILITY RURAL-URBAN DIVIDE URBANIZATION RETURNS TO EDUCATION COMPLEMENTARITY SCHOOL QUALITY ROLE MODEL |
| spellingShingle |
INTERGENERATIONAL MOBILITY RURAL-URBAN DIVIDE URBANIZATION RETURNS TO EDUCATION COMPLEMENTARITY SCHOOL QUALITY ROLE MODEL Ahsan, Md Nazmul Emran, M. Shahe Shilpi, Forhad The Rural-Urban Divide and Intergenerational Educational Mobility in a Developing Country : Theory and Evidence from Indonesia |
| geographic_facet |
East Asia and Pacific Indonesia |
| relation |
Policy Research Working Paper;No. 9464 |
| description |
This paper provides an analysis of the
rural-urban divide in intergenerational educational mobility
in Indonesia with two distinguishing features. First, the
estimating equations are derived from theory incorporating
rural-urban differences in returns to education and school
quality, and possible complementarity between parent’s
education and financial investment. Second, the data are
suitable for tackling the biases from sample truncation due
to coresidency and omitted cognitive ability heterogeneity.
The evidence rejects the workhorse linear intergenerational
educational persistence equation in favor of a convex
relation in rural and urban Indonesia. The rural-urban
relative mobility curves cross, with the children of low
educated fathers enjoying higher relative mobility in rural
areas, while the pattern flips in favor of the urban
children when the father has more than nine years of
schooling. However, the rural children face lower absolute
mobility across the whole distribution of father's
schooling. Estimates from the investment equation suggest
that, in urban areas, children~^!!^s peers are complementary
to financial investment by parents, while the adult role
models are substitutes. In contrast, separability holds in
villages. Peers and role models are not responsible for the
convexity in both rural and urban areas, suggesting more
efficient investment by educated parents as a likely
mechanism, as proposed by Becker et al. (2015, 2018). The
theoretical relation between the intercepts of the mobility
and investment equations helps in understand whether school
quality is complementary to or a substitute for parental
financial investment. This paper finds evidence of
substitutability, implying that public investment to improve
the quality of rural schools is desirable on both equity and
efficiency grounds. |
| format |
Working Paper |
| author |
Ahsan, Md Nazmul Emran, M. Shahe Shilpi, Forhad |
| author_facet |
Ahsan, Md Nazmul Emran, M. Shahe Shilpi, Forhad |
| author_sort |
Ahsan, Md Nazmul |
| title |
The Rural-Urban Divide and Intergenerational Educational Mobility in a Developing Country : Theory and Evidence from Indonesia |
| title_short |
The Rural-Urban Divide and Intergenerational Educational Mobility in a Developing Country : Theory and Evidence from Indonesia |
| title_full |
The Rural-Urban Divide and Intergenerational Educational Mobility in a Developing Country : Theory and Evidence from Indonesia |
| title_fullStr |
The Rural-Urban Divide and Intergenerational Educational Mobility in a Developing Country : Theory and Evidence from Indonesia |
| title_full_unstemmed |
The Rural-Urban Divide and Intergenerational Educational Mobility in a Developing Country : Theory and Evidence from Indonesia |
| title_sort |
rural-urban divide and intergenerational educational mobility in a developing country : theory and evidence from indonesia |
| publisher |
World Bank, Washington, DC |
| publishDate |
2020 |
| url |
http://documents.worldbank.org/curated/en/414131604430277237/The-Rural-Urban-Divide-and-Intergenerational-Educational-Mobility-in-a-Developing-Country-Theory-and-Evidence-from-Indonesia http://hdl.handle.net/10986/34731 |
| _version_ |
1764481535807848448 |