The Effects of Education, Experience and Skill on Individuals' Earning: Empirical Evidence from Khyber Pakhtunkhwa, Pakistan

The study aims at testing the Mincer and Becker earning function in the context of Pakistan. This study used a cross-sectional survey design. The micro level data were collected through a questionnaire survey from 100 individuals in Nowshera District, Khyber Pakhtunkhwa. A multi-stage sampling technique was used to select the target population. Through convenient sampling the respondents were interviewed. Simple and multiple regressions were employed to explore the relationship of dependent variable (earnings) with independent variables (education, experience, and skill). Results showed that all the econometric models were good fit. The explanatory variables were significantly explaining the variations in the dependent variable. Education, experience, and skill were the significant variables (at 99% CL) affecting earnings of individuals in separate models. However, skill was found insignificant in the overall model. There is a dire need of occupational knowledge and technical education. The government should take serious actions to promote technical education that would help exterminate unemployment. The future research is recommended to measure the skill of individual as a scale variable to see its more in-depth analysis with earnings.