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Human capital obsolescence: some evidence for Spain

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  • Inés P. Murillo
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    Abstract

    Purpose – The main objective of this paper is to analyse the link between human capital depreciation and the educational level of Spanish salaried workers. Design/methodology/approach – Wage equations are estimated by sector and occupation, following the empirical framework proposed by Neuman and Weiss. Data in this study refer to the Spanish labour market, using two cross-sectional employee-firm matched data. Findings – The estimates provided in this paper suggest that human capital depreciation rates are not homogeneous for the whole sample; in contrast, they vary across educational levels, being greater as the workers' school attainment increases. Research limitations/implications – The main restriction of the paper is the limited availability of quality longitudinal data to estimate human capital depreciation. Practical implications – Knowledge acquired by workers may quickly become obsolete in a context of technological change. Thus, the paper's main findings support the need for ongoing training programs to update workers' skills to changing market requirements. Originality/value – The added value of this paper is two-fold. On the one hand, returns to education and human capital depreciation for the Spanish labour force are estimated using a pseudo-panel created from two cross-sectional data bases. On the other hand, earnings equations are estimated by sector and occupation in order to calculate human capital depreciation rates; this procedure allows the authors to take into account the worker's occupation and their level of education as well as technological differences associated with their job.

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    Bibliographic Info

    Article provided by Emerald Group Publishing in its journal International Journal of Manpower.

    Volume (Year): 32 (2011)
    Issue (Month): 4 (July)
    Pages: 426-445

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    Handle: RePEc:eme:ijmpps:v:32:y:2011:i:4:p:426-445

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    Related research

    Keywords: Depreciation; Human capital; Rate of return; Spain;

    References

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    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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