THE IMPACT OF EDUCATION ON AGRICULTURAL PRODUCTIVITY: EVIDENCE FROM EAST ASIAN ECONOMIES

This study presents an efficient version of test for the hypothesis that education plays a key role in influencing agricultural productivity based on a switching regression model. In the present setting, farmers’ ability to deal with disequilibria is allowed to change with education, which thereby provides a concrete evidence of the effect of education on selected East Asian production agriculture. The results suggest that there exists a threshold for education to be influential to agricultural productivity change when the selected East-Asian economies are categoried by their degree of economic development. Moreover, for the group of economies where education constitutes a major determinant of productivity growth in both the technological progression and/or stagnation/recession regimes, the effect of education is found to vary from economy to economy and from regime to regime. Generally speaking, however, those East-Asian economies tend to reach their turning point in short time despite of the mentioned differences. This result therefore leads to important policy implications concerning giving an impetus to human capital investment in the agriculture sector.