Preprint Article Version 1 This version is not peer-reviewed

A Semi-parametric Recursive Trivariate Probit Modeling of the Contemporaneous Dynamics of Literacy, Labor Market Participation and Poverty in Burkina Faso: What role does Formal Education Play?

Version 1 : Received: 19 February 2018 / Approved: 19 February 2018 / Online: 19 February 2018 (16:00:35 CET)

How to cite: Niankara, I. A Semi-parametric Recursive Trivariate Probit Modeling of the Contemporaneous Dynamics of Literacy, Labor Market Participation and Poverty in Burkina Faso: What role does Formal Education Play?. Preprints 2018, 2018020121 (doi: 10.20944/preprints201802.0121.v1). Niankara, I. A Semi-parametric Recursive Trivariate Probit Modeling of the Contemporaneous Dynamics of Literacy, Labor Market Participation and Poverty in Burkina Faso: What role does Formal Education Play?. Preprints 2018, 2018020121 (doi: 10.20944/preprints201802.0121.v1).

Abstract

This research contributes to the overall debate on education for sustainable development (ESD) by shed-
ding lights on the contributing role of formal education to the contemporaneous dynamics of literacy,
labor market participation and poverty reduction in Africa, with a focus on Burkina Faso. The study
uses a semi-parametric recursive trivariate probit modeling approach, and data from the 2014 National
Survey on Household Living Conditions in Burkina Faso.
The results show that the embraced systemic approach in this analysis is statistically signi cant as shown
by the 95% con dence intervals on the three correlation coeffcients in the model. Furthermore, education
does improve literacy skills, however improved literacy skills in itself does not guaranty active labor market
participation in Burkina Faso. Active labor market participation seem to be affected by labor market
rates of return, and individual reservation wage (or income). When labor market rate of return is short
of high literacy skilled individuals' reservation wage, then the natural response is a choice of inactivity
in the labor market, by the later group. Simultaneously however, it is found that active labor market
participation leads to poverty reduction; therefore, in addition to new industrial policies for structural
transformation of the economy, policy makers in Burkina Faso should consider education and minimum
wage reforms to give highly literate household members the incentive to be active in the labor market.

Supplementary and Associated Material

Subject Areas

Formal Education, Labor Market Participation, Literacy, Poverty, Sustainable Development, Semipametric Trivariate Probit

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