The Kuznets Curve of Education : A Global Perspective on Education Inequalities

Abstract

This paper depicts the world distribution of education over 140 years, improving and extending the database recently released by Morrisson and Murtin (2009), which focuses on average years of schooling. The document provides both average years of schooling and the distribution of education as summarised up by four quantiles in each country. Importantly, this new database is cross-validated by historical data on illiteracy rates. Then, we describe average stocks of primary, secondary and tertiary schooling by region since 1870, and estimate world inequality in years of schooling, which has been dramatically reduced since 1870. Focusing on the measurement of education inequality, this paper raises an important methodological issue. The report shows that a substantial share of inequality in years of schooling can be mechanically explained by a single component of the distribution of education, namely the population that has not attended school, subsequently called the illiterate population. Actually, the authors find that the observed decrease in inequality in years of schooling over the XXth century is almost entirely explained by the decline in illiteracy. The researchers believe that this result, derived both theoretically and empirically, could help to reconsider an empirical fact discussed in the literature on education inequality, namely the cross-country negative correlation between the average of and the inequality in years of schooling. This correlation mainly reflects the negative and mechanical correlation between average schooling and the illiteracy rate. In line with a recent macroeconomic literature, the researchers then turn to human capital as defined by Mincer (1974), in order to confer a monetary dimension to education. We propose estimates of the world inequality in human capital, examining several definitions for human capital. The document focus on one functional form in particular, which accounts for the existence of diminishing returns to schooling. It is the only one that can account for the cross-country negative correlation between Mincer returns to schooling and average years of schooling, as described by Psacharopoulos and Patrinos (2004). At the national level, the research finds that that human capital inequality within countries has increased then stabilized or even decreased in most regions of the world. When plotted against average years of schooling, human capital inequality within countries has clearly followed an inverted U-shape curve, namely a “Kuznets curve of education”. At the global level, the authorsefind that human capital inequality has increased from 1870 to approximatively 1970, then has decreased. The document interprets these findings as a consequence of mass education and the existence of diminishing returns to schooling.