Secondary school dropout and work outcomes in ten developing countries

This paper analyzes the impact of secondary school dropout on the work outcomes of young people in ten developing countries. Understanding such a phenomenon is important because it may affect work prospects, exacerbate income inequality and determine macroeconomic lasting effects given that the formation of a skilled workforce is a key element of economic development and growth. When accounting for endogeneity, we find that secondary school dropout decreases the probability of being employed in non-elementary occupations, suggesting that unskilled workers fail to meet the increasing demand for a skilled workforce. Secondary school dropout, indeed, hinders the accumulation of adequate levels of human capital and anticipates entry into the unskilled labor market. Thus, policy-makers should aim at the extension and efficacy of compulsory education to the secondary level to avoid future under-education problems to promote a skilled workforce and encourage economic development and growth in the long run. © 2018 The Society for Policy Modeling