Human Capital Investment in the Presence of Unemployment: Application to University Enrolment in Spain
AbstractThis paper explores the effects of unemployment on the school enrolment decisions. A few studies that have taken up this issue in the past have produced results that are seemingly contradictory with each other. We build a model of the enrolment decision that is capable of explaining these results in a unified manner. In this model, unemployment affects the enrolment decision both through changing costs of and returns to education (investment effect) and through changing parental wealth and thus affecting intergenerational transfers (wealth effect). We develop an empirical framework that allows us to test presence of these two effects separately, and apply this to panel data of Spanish regions on university enrolment. We find that both effects are present.
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Bibliographic InfoPaper provided by University of Oxford, Department of Economics in its series Economics Series Working Papers with number 66.
Date of creation: 01 Jan 2001
Date of revision:
education; participation; unemployment; intergenerational transfers; opportunity costs;
Find related papers by JEL classification:
- I1 - Health, Education, and Welfare - - Health
- J2 - Labor and Demographic Economics - - Demand and Supply of Labor
- J6 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies
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