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Human Capital Spill-Overs Within the Workplace

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Author Info

  • Battu, Harminder

    ()
    (University of Aberdeen)

  • Belfield, Clive R.

    ()
    (Queens College, CUNY)

  • Sloane, Peter J.

    ()
    (Swansea University)

Abstract

An individual’s human capital has a strong influence on earnings. Yet individual, worker-level estimations of earnings rarely include the characteristics of co-workers or detailed firm-level controls. In this paper, we use a unique matched worker–workplace dataset to estimate the effect on own earnings of co-workers’ education. Our results, using the 1998 UK Workplace Employee Relations Survey, show significant effects. Own earnings premia fall slightly, but there is an independent, significantly positive effect from average workplace education. We also test for interactions between own and co-worker education levels. However, these interactions appear negative: education is valued less highly at workplaces where education levels are already high. This result runs counter to our theoretical prediction.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 404.

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Length: 30 pages
Date of creation: Nov 2001
Date of revision:
Publication status: published in: Oxford Bulletin of Economics and Statistics, 2003, 65 (5), 575-594
Handle: RePEc:iza:izadps:dp404

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Keywords: workplace performance; human capital; Educational economics;

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References

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Cited by:
  1. Alison L Booth & Gylfi Zoega, 2005. "Worker Heterogeneity, Intra-firm Externalities and Wage Compression," Birkbeck Working Papers in Economics and Finance 0515, Birkbeck, Department of Economics, Mathematics & Statistics.
  2. Alcala, Francisco & Hernandez, Pedro J., 2005. "Firm characteristics, labor sorting, and wages," MPRA Paper 1226, University Library of Munich, Germany, revised 17 Nov 2006.
  3. Grip Andries de & Sauermann Jan & Sieben Inge, 2011. "The role of peers in estimating tenure-performance profiles: evidence from personnel data," Research Memorandum 052, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
  4. Alvarez, J. & Forrest, D. & Sanz, I. & Tena, J.D., 2011. "Impact of importing foreign talent on performance levels of local co-workers," Labour Economics, Elsevier, vol. 18(3), pages 287-296, June.
  5. Marcos E. Domínguez Viera, 2011. "Does the Impact of Oportunidades Program Increases in Highly Competitive Regions?," Ensayos Revista de Economia, Universidad Autonoma de Nuevo Leon, Facultad de Economia, vol. 0(2), pages 79-111, November.
  6. Aniela Wirz, 2008. "Private returns to education versus education spill-over effects," Empirical Economics, Springer, vol. 34(2), pages 315-342, March.
  7. Hipólito Simón, 2010. "International Differences in Wage Inequality: A New Glance with European Matched Employer-Employee Data," British Journal of Industrial Relations, London School of Economics, vol. 48(2), pages 310-346, 06.
  8. Mok, Penny & Mason, Geoff & Stevens, Philip & Timmins, Jason, 2012. "A Good Worker is Hard to Find: Skills Shortages in New Zealand Firms," Occasional Papers 12/5, Ministry of Economic Development, New Zealand.
  9. Nordman, Christophe Jalil & Wolff, François-Charles, 2009. "On-the-job learning and earnings: Comparative evidence from Morocco and Senegal," Economics Papers from University Paris Dauphine 123456789/5948, Paris Dauphine University.
  10. Francisco Alcalá & Pedro Hernández, 2010. "Firms’ main market, human capital, and wages," SERIEs, Spanish Economic Association, vol. 1(4), pages 433-458, September.
  11. Metcalfe, Renuka & Sloane, Peter J., 2007. "Human Capital Spillovers and Economic Performance in the Workplace in 2004: Some British Evidence," IZA Discussion Papers 2774, Institute for the Study of Labor (IZA).
  12. Pavel V. Travkin, 2014. "The Returns To Training In Russia: A Difference-In-Differences Analysis," HSE Working papers WP BRP 56/EC/2014, National Research University Higher School of Economics.
  13. Travkin, Pavel, 2014. "The impact of the on-the-job training on Russian worker’s salary: The effect of abilities approach," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 33(1), pages 51-70.
  14. David C. Maré, 2003. "Ideas for Growth?," Working Papers 03_19, Motu Economic and Public Policy Research.

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