Lost Wages: The Covid-19 Cost of School Closures

18 Pages Posted: 31 Aug 2020

See all articles by George Psacharopoulos

George Psacharopoulos

Georgetown University

Victoria Collis

The EdTech Hub

Harry A. Patrinos

World Bank

Emiliana Vegas

The Brookings Institution

Multiple version iconThere are 3 versions of this paper

Abstract

Social distancing requirements associated with COVID-19 have led to school closures. In April, 192 countries had closed all schools and universities, affecting more than 90 percent of the world's learners: over 1.5 billion children and young people. Closures are expected to reduce schooling and lead to future losses in earnings. Starting from the assumption that every additional year of schooling translates to 8 percent in future earnings, this paper estimates and confirms the loss in marginal future earnings on the basis of a four-month shutdown. We also estimated the losses by level of education. The findings show that the school closures reduce future earnings. It is also likely that students from low-income countries will be affected most, where the earning losses will be devastating. These estimates are conservative, assuming closures end after four months, with schools re-opening in the new academic year, and that school quality will not suffer.

Keywords: COVID-19, earnings, education

JEL Classification: I26, I20, J24

Suggested Citation

Psacharopoulos, George and Collis, Victoria and Patrinos, Harry Anthony and Vegas, Emiliana, Lost Wages: The Covid-19 Cost of School Closures. IZA Discussion Paper No. 13641, Available at SSRN: https://ssrn.com/abstract=3682955

George Psacharopoulos (Contact Author)

Georgetown University

Washington, DC 20057
United States

Victoria Collis

The EdTech Hub ( email )

United Kingdom

Harry Anthony Patrinos

World Bank ( email )

1818 H Street NW
Washington, DC 20433
United States

Emiliana Vegas

The Brookings Institution ( email )

1775 Massachusetts Ave, NW
Washington, DC 20036
United States
202.540.7776 (Phone)
20007 (Fax)

HOME PAGE: http://https://www.brookings.edu/experts/emiliana-vegas/

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