REVISITING THE RETURNS TO EDUCATION AND GENDER WAGE DISPARITIES IN INDONESIA: EVIDENCE FROM IFLS4

This study investigates the relationship between educational attainment, gender, and income in Indonesia
using individual-level data from the Indonesia Family Life Survey (IFLS4). Applying an Ordinary Least Squares (OLS)
regression model with log-transformed income as the dependent variable, the analysis explores whether years of
schooling and gender significantly affect earnings. The findings indicate that while education has a positive association
with income, the effect is statistically insignificant. Similarly, no meaningful income gap was observed between male
and female respondents after controlling for education. These results suggest that the economic returns to education in
Indonesia may be limited by structural labor market conditions, particularly the dominance of informal employment and
mismatches between education and job requirements. Although gender did not emerge as a significant predictor in this
sample, broader national data continue to show disparities, pointing to the need for cautious interpretation. The study
highlights the importance of aligning educational systems with labor market demands and addressing systemic barriers
to wage equity.