Can Skill Diversification Improve Welfare in Rural Areas? Evidence from the Rural Skills Development Project in Bhutan

Publication | June 2011

This paper investigates the short-term effects and the determinants of participation in a vocational skills training program that was intended to diversify incomes outside of agriculture. It finds limited positive impacts of the program along various economic, social, and psycho-social dimensions with the exception of diversifying household incomes into the skill areas. Females are significantly less likely to participate. The results and anecdotal evidence suggest the need to place a greater emphasis on creating a mechanism to connect the training program to income generating opportunities and possibly refine the curriculum and extend the training time to allow trainees to develop their skills. Greater equality in the skill development process may require providing more female-friendly training that has flexibility in training time and venues as well as training in other skill areas.

Contents 

  • Abstract
  • Introduction
  • Rural Poverty in Bhutan and the Rural Skills Development Project
  • Related Literature
  • RSDP Survey
  • Empirical Methods and Results
  • Robustness Checks
  • Discussion
  • Conclusion
  • Appendixes
  • References