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Quality of Institutions and the Macro-Return to Education: The Case of Middle East and North Africa (MENA)

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Economic Development in the MENA Region

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Abstract

The paper investigates the reasons for the established disappointing performance of the Arab education system as compared to the rest of the world. We focus on the role of the quality of informal institutions as measured by the World Value Survey (WVS) and formal institutions as measured by the International Country Risk Guide (ICRG) and the World Governance Indicators (WGI). We consider a Barro’s type production function where we condition the impact of education on growth by the quality of institutions. The resulting specification is estimated on a sample of 74 developed and developing countries over the period 1984–2017. The analysis shows that the region exhibits the lowest quality of institutions in many instances and that its performance in terms of growth is disappointing. Since our econometric investigation shows that the impact of education on growth increases with the quality of institutions, we conclude that a part of the explanation to the established disappointing performance of the Arab countries’ education system is to be found in the low quality of their institution. The conclusion provides some policy recommendations.

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Notes

  1. 1.

    http://www.barrolee.com/.

  2. 2.

    Government Stability 12, Socioeconomic Conditions 12, Investment Profile 12, Internal Conflict 12, External Conflict 12, Corruption 6, Military in Politics 6, Religious Tensions 6, Law and Order 6, Ethnic Tensions 6, Democratic Accountability 6, Bureaucracy Quality 4.

  3. 3.

    For a recent review of the institutional background of countries in the Middle East and North Africa (MENA), see Ben Ali and Krammer (2016).

  4. 4.

    Here, we report only the results of those specifications for which at least one coefficient involving institutions is significant. The others are available from the author.

  5. 5.

    The whole marginal effect of education on growth is never significant with religious tensions.

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Author information

Authors and Affiliations

  1. University of Brussels and Economic Research Forum, Brussels, Belgium

    Khalid Sekkat

Authors
  1. Khalid Sekkat
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Corresponding author

Correspondence to Khalid Sekkat .

Editor information

Editors and Affiliations

  1. College of Business and Economics, Qatar University, Doha, Qatar

    Mohamed Sami Ben Ali

Appendices

Appendix 1: Countries in the Sample

Albania

Kazakhstan

Algeria

Kosovo

Argentina

Kyrgyz Rep.

Armenia

Latvia

Australia

Lebanon

Azerbaijan

Lithuania

Belarus

Malaysia

Belgium

Mexico

Bolivia

Moldova

Bosnia and Herz.

Mongolia

Brazil

Montenegro

Cambodia

Morocco

Chile

Myanmar

China

Netherlands

Colombia

Nicaragua

Costa Rica

Pakistan

Cyprus

Panama

Czech Rep.

Paraguay

Dominican Republic

Peru

Ecuador

Poland

Egypt

Portugal

El Salvador

Romania

Estonia

Russia

France

Slovak Rep.

FYR Macedonia

Slovenia

Georgia

Spain

Germany

Sri Lanka

Greece

Sweden

Honduras

Switzerland

Hong Kong

Thailand

Hungary

Tunisia

India

Turkey

Indonesia

UK

Italy

Ukraine

Jamaica

Uruguay

Jordan

USA

 

Venezuela

 

Vietnam

Appendix 2: Statistics

See Tables 2.5 and 2.6.

Table 2.5 Descriptive statistics
Full size table
Table 2.6 Correlations
Full size table

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Sekkat, K. (2021). Quality of Institutions and the Macro-Return to Education: The Case of Middle East and North Africa (MENA). In: Ben Ali, M.S. (eds) Economic Development in the MENA Region. Perspectives on Development in the Middle East and North Africa (MENA) Region. Springer, Cham. https://doi.org/10.1007/978-3-030-66380-3_2

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