Plamen Nikolov

Institution: Harvard Institute for Quantitative Social Science
Website: My Webpage

I am an Affiliated Professor at The Harvard University Institute for Quantitative Social Science, The University of Chicago's Human Capital and Economic Opportunity Global Working Group, a Research Fellow of the Global Labor Organization, and a Research Fellow of the IZA Institute of Labor Economics.

My expertise is in the design and execution of randomized control trials (RCTs) and cohort studies in resource-limited settings and low- and middle-income countries (LMICs). I am a development & labor economist whose research broadly focuses on human capital in LMICs. Using mainly experimental methods, I research in three major areas:

  • (1) causes and consequences of better educational attainment and better health in developing countries,
  • (2) the role of credit constraints in financial markets in low-income settings, and
  • (3) causes and consequences of higher productivity and better labor market outcomes, with particular emphasis on insights from the behavioral sciences, in developing countries.

In several ongoing (distinct) collaborations with The World Bank and BRAC, I am involved several experimental or quasi-experimental interventions in South Asia and East Africa. I received my doctorate from Harvard University under the direction of Lawrence KatzDavid Cutler, and Raj Chetty. I also hold a master's degree in International Economics and Arabic/Middle East Studies from Johns Hopkins University (SAIS). I have very extensive field experience in Afghanistan, Kyrgyzstan, Tanzania, Kenya, Egypt, and South Africa.

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Plamen Nikolov, Steve Yeh.

Cognition, a component of human capital, is fundamental for decision-making, and understanding the causes of human capital depreciation in old age is especially important in aging societies. Using various proxy measures of cognitive performance from a longitudinal survey in South Africa, we study how education affects cognition in late adulthood. We show that an extra year of schooling improves memory performance and general cognition. We find evidence of heterogeneous effects by gender: the effects are stronger among women. We explore potential mechanisms, and we show that a more supportive social environment, improved health habits, and reduced stress levels likely play a critical role in mediating the beneficial effects of educational attainment on cognition among the elderly.

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Plamen Nikolov, Nusrat Jimi.

Evidence on educational returns and the factors that determine the demand for schooling in developing countries is extremely scarce. We use two surveys from Tanzania to estimate both the actual and perceived schooling returns and subsequently examine what factors drive individual misperceptions regarding actual returns. Using ordinary least squares and instrumental variable methods, we find that each additional year of schooling in Tanzania increases earnings, on average, by 9 to 11 percent. We find that on average, individuals underestimate returns to schooling by 74 to 79 percent, and three factors are associated with these misperceptions: income, asset poverty, and educational attainment. Shedding light on what factors relate to individual beliefs about educational returns can inform policy on how to structure effective interventions to correct individuals' misperceptions.

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Plamen Nikolov, Nusrat Jimi.

Numerous studies have considered the important role of cognition in estimating the returns to schooling. How cognitive abilities affect schooling may have important policy implications, especially in developing countries during periods of increasing educational attainment. Using two longitudinal labor surveys that collect direct proxy measures of cognitive skills, we study the importance of specific cognitive domains for the returns to schooling in two samples. We instrument for schooling levels and we find that each additional year of schooling leads to an increase in earnings by approximately 18-20 percent. The estimated effect sizes—based on the two-stage least squares estimates—are above the corresponding ordinary least squares estimates. Furthermore, we estimate and demonstrate the importance of specific cognitive domains in the classical Mincer equation. We find that executive functioning skills (i.e., memory and orientation) are important drivers of earnings in the rural sample, whereas higher-order cognitive skills (i.e., numeracy) are more important for determining earnings in the urban sample. Although numeracy is tested in both samples, it is only a statistically significant predictor of earnings in the urban sample. (JEL I21, F63, F66, N37)

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