health (Clark & Royer, 2013; Powdthavee, 2010), their propensity to get a divorce (Oreopoulos & Salvanes, 2011), and positively affecting attitudes toward climate change (Angrist et al., 2024).

We use labor force and household surveys to show the returns to education overall, and for men and women. Further, we control for endogeneity and use the compulsory schooling law to causally estimate the returns to schooling. We complement our analysis of the return to schooling by using macro-level indicators to estimate the return of an additional year of schooling in the population on gross national income per capita, which we then use to simulate the economic loss from restricting female education. The returns to education in Afghanistan are low on average and the labor force participation rate of women is low. The return to schooling is lowest in Afghanistan among all countries studied (Montenegro & Patrinos, 2023). At only 4 percent, it is dramatically low compared to a worldwide average of 10 percent (Psacharopoulos & Patrinos, 2018). However, women have a much higher rate of return to education. Thus, every year of schooling produces a larger increment in earnings for women than it does for men. Women’s returns are much higher at 13 percent compared to just 3 percent for men. Their contribution to the economy is therefore proportionately larger. We project that banning women from education and work could cost the country annually more than $1.4 billion.

Since the 1970s, Afghanistan has endured continuous instability. The overthrow of the last king triggered the invasion by the Soviet Union in 1979. A Soviet-backed state ruled until 1993, followed by a period of Mujahideen rule, civil war, and the Taliban’s rise to power in 1996. The Taliban regime was toppled by the invasion of the United States in 2001, leading to the establishment of the Islamic Republic of Afghanistan, which fell in 2021, marking the Taliban’s return. These upheavals have caused widespread disruptions, deeply affecting educational opportunities, particularly for women. The ban on women’s education by the Taliban in the late 1990s, for political purposes such as establishing group cohesion (Berman, 2009; Berman & Laitin, 2008), negatively impacted access to public goods, including education. Noury & Speciale (2016) show that the Taliban’s religious rule, such as banning girls’ schooling, reducing girls’ enrollment, and prohibiting women from working, negatively influences their labor market experiences and subsequent expectations on the returns to education. Brunner & Mihailov (2023) find that girls who missed out on the chance of start school due to the ban in the 1996–2001 period were worse off in the long run, experiencing up to a 50 percent reduction in their average years of schooling, literacy probability, and primary school completion probability, compared to women in the control provinces that were not under Taliban rule. Efforts by the Afghan government, local and international communities in the post-2001 era led to a substantial expansion of enrollment in primary schooling (Najam & Johnston, 2023). A randomized evaluation on the impact of village-based schools on children’s academic performance in rural northwestern Afghanistan shows that they significantly increased enrollment and test scores among all children, but particularly for girls (Burde & Linden, 2013). Moreover, policies such as affirmative action were implemented to enhance women’s access to tertiary education. Najam (2024) shows that a gender quota increased the proportion of women in public universities and helped close the gender gap. However, existing restrictions on women’s education will have a detrimental effect on their well-being and negative impacts on future economic growth.

We show that, on average, the return to schooling in Afghanistan is lower than the global aver- age; yet the return on women’s schooling is four times greater than that of men. Given the ban on women’s schooling, we discuss the economic impact of the contraction of women’s education and anticipate that our forecast will serve as a starting point for more sophisticated analyses of the implications of banning schooling for the entire female population. The Taliban’s ban on women’s education beyond the sixth grade and prohibitions on work, and the latest order that all women employed in public agencies, that are not allowed to work, will be paid a flat salary of only 5,000 AFN ( _≈_ $72) provide unique scenarios for future studies to assess the impact of dramatic policy changes on the returns to schooling in the context of a developing country 3