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Education, Child Labor and Human Capital Formation in Selected Urban and Rural Settings of Pakistan

Series:

Abdul Salam Lodhi

Education is essential for human resource development and sustainable socio-economic development of a society, as it can facilitate economic growth through the broader application of knowledge, skills, and the creative strength of a society. The other positive and long-term outcomes of education include the reduction of poverty and inequality, improvement of health status and good governance in the implementation of socio-economic policies. Keeping in view the role that education through human capital formation can play in the development of Pakistan where the population of the children below 14 years old is about 35 percent of the total population; this study aims at delineating the factors that are obstructing the educational activities of the children below the age of 14 years. Furthermore, the main research interest in this study was to see how pecuniary and non-pecuniary factors are impeding the process of human capital formation. The results indicate that variables such as parental education and perceptions of secular and non-secular education, role of mother in domestic authority, believe in tribal norms, religiosity of the head-of-household, child age and gender, and proximity to school are playing a significant role in the choice of childhood activities.

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1. Introduction ................................................................................................... 1 1.1 The Education System of Pakistan: A Brief Overview ........................ 6 1.2 Problem Statement ................................................................................ 8 1.3 Research Questions and Hypothesis ..................................................... 9 1.4 Theoretical Background ...................................................................... 10 1.5 Description of the Data ....................................................................... 14 1.6 Appendix ............................................................................................. 16 2. Factors Determining Childhood Participation in Education and Alternate Activities ............................................................................. 19 2.1 Introduction ......................................................................................... 19 2.2 The Model ........................................................................................... 23 2.3 Description of the Variables ............................................................... 27 2.4 Descriptive Analysis ........................................................................... 30 2.4.1 Childhood Activities ........................................................................... 30 2.4.2 Justification of Childhood Activity Selection ..................................... 32 2.4.3 Childhood Activities versus Household Income ................................ 35 2.4.4 Childhood Activities versus Head-of-Household Education .............. 36 2.4.5 Childhood Activities versus Maternal Education ............................... 36 2.4.6 Childhood Activities and Head-of-Household Perceptions of School Education ................................................................................ 37 2.5 Multinomial Probit Model Results ...................................................... 38 2.5.1 Comparison of Childhood Activities between Rural and Urban Areas ........................................................................................ 43 2.5.2 Comparison of Child’s Activities Selection by Gender ..................... 44 2.6 Marginal Effects on Activity Selection............................................... 45 2.7 Conclusions ......................................................................................... 51 2.8 Appendix ............................................................................................. 56 3. Parental Perceptions of Secular School Education and Human Capital Formation ................................................................... 67 3.1 Introduction ......................................................................................... 67 xviii 3.2 The Model ........................................................................................... 73 3.3 Descriptive Analysis ........................................................................... 75 3.3.1 Household-Head’s Education and Perception .................................... 76 3.3.2 Household Income and Perception ..................................................... 77 3.4 Modeling the Perception of the Impact of Schooling on Future Earnings ................................................................................... 79 3.4.1 Regression Results .............................................................................. 81 3.4.2 Predicted Probabilities ........................................................................ 83 3.5 Modeling Perception of the Compatibility of Secular School Education with Religious Values ........................................................ 84 3.5.1 Regression Results .............................................................................. 87 3.5.2 Predicted Probabilities ........................................................................ 89 3.6 Conclusion........................................................................................... 90 3.7 Appendix ............................................................................................. 93 A. Basic Algebra for Interpreting the Results of SOR Equation ............. 93 B. Test for Distinguish-Ability ................................................................ 95 4. Combined Schooling and...

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