Literacy, Numeracy, and Household Economic Well-Being in Ghana

Niels-Hugo Blunch, World Bank Group and George Washington University

This paper examines the impact of literacy, numeracy and schooling on household economic well-being in Ghana. The analysis considers per capita household expenditures and per capita household expenditures in adult equivalents. Previous studies of the determinants of household expenditures have mostly been limited to investigating the impact of schooling only and, as a consequence, largely have not considered skills and also have ignored alternative routes to acquiring skills, such as adult literacy programs. Analyzing a recent household survey for Ghana, this paper addresses both of these issues. To address endogeneity, the skills, schooling and household expenditure equations are estimated jointly using the Mroz-Guilkey correction approach (Mroz and Guilkey, 1992). Preliminary results indicate statistically significant effects from numeracy skills on household expenditures independent of the effects from schooling.