In this paper we evaluate different measurement practices when calculating the human capital content of a country's net trade. The calculations are performed using a structural measure developed by Lundberg & Wiker (1997) that relates the average factor input requirements in exports relative to those in imports. We find the calculations highly dependent on measurement practice when performing those on a cross-section for a single year. However, when calculating the human capital content of trade over time instead, the inclusion of service sectors in the trade vector as well as variable factor input requirements seem to be very important.
This paper then continues with an empirical evaluation of the human capital content of Swedish trade in 1986-2000. We find that during the period 1986-1992, the average human capital intensity in exports relative to imports was slightly increasing, mirroring an increased specialization in human capital-intensive production. After 1992, though, there is a rapid decrease in the human capital content of trade in exports relative to imports. In 1995 there is a recovery, but the recovery seems both to be leveling out and turning down in the late 1990's. In this paper we also draw the conclusion that a well functioning educational system is important for a country's comparative advantage.
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Paper provided by Örebro University, Swedish Business School in its series Working Papers with number
2005:7.
References listed on IDEAS 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.:
Leamer, Edward E. & Levinsohn, James, 1995.
"International trade theory: The evidence,"
Handbook of International Economics,
in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 26, pages 1339-1394
Elsevier.
[Downloadable!] (restricted)
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Donald R. Davis & David E. Weinstein, 2001.
"The Factor Content of Trade,"
NBER Working Papers
8637, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
Other versions: