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Using data from Demographic and Health Surveys for eleven countries in sub-Saharan Africa,the authorestimates the effect of local HIV prevalence on individual human capital investment. The authorfinds that the HIV/AIDS epidemic has reduced human capital investment: living in an area with higher HIV prevalence is associated with lower levels of completed schooling and slower progress through school. These results are consistent with a model of human capital investment in which parents and children respond to changes in the expected return to schooling driven by mortality risk.
Report assesses impact of HIV/AIDS on the education sector, addressing both the current situation and what can be expected: fewer school enrolments, decreased teacher supply, increased health costs straining governments and families. Initial steps for preventive action to combat these hardships are then outlined.