The Effects of Human Capital and Social Factors on the Household Income of Bangladesh: An Econometric Analysis

TThe study examined the effects of human capital (education and experience) and social factors (gender, marital status, spatial condition, and occupation) on the monthly income of the people of Bangladesh through OLS and quantile regression based on the data of 9943 sample of Household Income and Expenditure Survey (HIES). It appears that both human capital and social factors have significant explanatory power to explicate the monthly income of the household. The OLS and quantile regression suggest that the effects of social factors are superior to that of human capital on the monthly income. The estimates further reveal that urban people get 18% more wage than their rural counterparts, and people engaged in the non-agricultural sector received 25% higher wages than the agricultural sector. Besides, female workers receive 36% less wage than male workers. Nevertheless, there is a distinct effect of the human capital and social factors in the gender and rural-urban context. The study recommends, a reorient policy to properly address these gender wage gap, sectoral and area-specific issues of the labor market with a view to ensuring the fair income distribution and inequality reduction.