Occupational And Earning Dynamics, The Roles Of Wealth And Education In The Rural Non-Farm Economy: Evidence From Thailand And Indonesia
The first paper, "Farm and Non-farm Occupational and Earnings Dynamics in Rural Thailand", explores individual occupational and earnings dynamics in rural Thailand during 2005-2010. We find significant occupational transitions, mainly involving moving out of farming and into non-farm employment, rather than starting businesses, especially enterprises that employ others. Using stochastic dominance, we identify an occupational ladder, with the most remunerative employment as a nonfarm business owner/employer, and the worst as an agricultural worker. Occupational transitions into the rural non-farm economy are associated with statistically significant earnings gains while transitions into farming are associated with earnings losses. These results are confirmed with a variety of methods to control for prospective unobserved heterogeneity. However, a small number of individuals become and remain non-farm employers, reflecting the difficulty in operating non-farm businesses that employ others. The second paper, "The Correlates and Dynamics of Rural Household Nonfarm Business and Entrepreneurial Job Creation in Thailand", explores the characteristics of those non-farm household entrepreneurs who expand their businesses by hiring non-family members, as well as the push and pull factors that play a role in supporting job creation within the rural non-farm economy and the dynamics of rural non-farm business status. More than 90 percent of rural non-farm enterprises are self-employed without non-family workers and rarely grow larger into enterprises that provide jobs outside the family. Instead, we observe a tendency for microenterprises and small-medium enterprises to contract in size. Non-farm businesses who hire more workers have more household assets, smaller agricultural land holdings, and lower opportunity costs of labor related to other household activities. Credit availability also plays an important role in starting an enterprise and hiring more workers. The third paper, "Intersectoral and Gender Heterogeneity in the Marginal Earnings Gains Associated with Education in Indonesia", studies how individual earnings respond to added educational attainment given intersectoral labor market heterogeneity and gender differences, as well as the potential signaling that comes from educational credentialing in the job market. We focus on the problem of nonrandom selection into sector of employment. Using the Indonesian Family Life Survey data from 1993-2007, we use parents' occupation and education as instruments influencing individuals' sector of employment. We find evidence of both sheepskin effects associated with the completion of specific, multi-year stages of schooling and intersectoral differences in the estimated marginal earnings gains associated with educational attainment, all of which vary between females and males. These findings carry significant implications for understanding patterns of private investment in education if not all children are equally likely to enter all careers and marginal earnings gains associated with educational attainment vary markedly among future work patterns.
Earnings dynamics; Rural non-farm economy; Marginal earnings gains from education
Fields, Gary Sheldon; Blalock, Garrick
Ph.D. of Agricultural Economics
Doctor of Philosophy
dissertation or thesis