FARM EARNINGS, EDUCATIONAL-ATTAINMENT, AND ROLE OF PUBLIC-POLICY - SOME EVIDENCE FROM MEXICO

Using real household survey data from Mexico, this study evaluates (a) the impact of schooling on farm earnings through the ''direct'' and ' 'allocative'' effects of human capital; (b) the household demand for c hildren's schooling; and (c) using macro-level data, the association b etween children's school-participation and some policy variables. The overall rate of return to household heads' schooling is estimated at 2 5%, and for wives, 19%. The allocative effect of schooling of househol d heads dominates over the direct effect. Mother's schooling and farm size exercise significantly positive effects on household demand for s chooling; while in the macro model, policy variables, government expen diture and pupil-teacher ratio appear strong determinants of children' s attainment of primary schooling. (C) 1997 Elsevier Science Ltd. All rights reserved.