Education quality and wages in the Brazilian municipalities

Abstract

The literature suggests that human capital has a positive relationship with income, so increasing the workers' schooling is indispensable for economic development. In addition to measures related to the quantity of schooling, as usual in empirical studies, it is essential to consider aspects of its quality. Therefore, the present study analyzes the relationship between the quality of schooling and workers' income level in the Brazilian municipalities, considering the spatial effects on the estimation methods. Using the Basic Education Development Index (Ideb) as measures of educational quality, the estimates indicate the importance of educational quality in the workers' wages. In addition, there is a relevant spatial effect. In designing public policies aiming to promote regional economic development, it is essential to consider these elements (quality of education and spatial effects).