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The Relative Efficiency of Skilled Labor across Countries: Measurement and Interpretation

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  • Federico Rossi

    (Warwick)

Abstract

This paper studies how the relative productivity of skilled and unskilled labor varies across countries. I use both micro-data and other sources for countries at different stages of development to document that the skill premium varies little between rich and poor countries, in spite of large differences in the relative skill supply. This pattern is consistent with the view that the relative productivity of skilled workers is higher in rich countries. I propose a methodology based on the comparison of labor market outcomes of immigrants with different levels of educational attainment to discriminate between technology and unobserved human capital as drivers of these patterns. I find that human capital quality plays a minor role in explaining cross-country differences in relative skill efficiency.

Suggested Citation

  • Federico Rossi, 2019. "The Relative Efficiency of Skilled Labor across Countries: Measurement and Interpretation," 2019 Meeting Papers 829, Society for Economic Dynamics.
    • Handle: RePEc:red:sed019:829
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    Cited by:

    1. Rossi,Federico, 2018. "Human Capital and Macro-Economic Development : A Review of the Evidence," Policy Research Working Paper Series 8650, The World Bank.
    2. Battisti, Michele & Gatto, Massimo Del & Parmeter, Christopher F., 2022. "Skill-biased technical change and labor market inefficiency," Journal of Economic Dynamics and Control, Elsevier, vol. 139(C).
    3. Anurag Banerjee & Parantap Basu & Elisa Keller, 2023. "Cross‐country disparities in skill premium and skill acquisition," Economic Inquiry, Western Economic Association International, vol. 61(1), pages 179-198, January.
    4. Lutz Hendricks & Todd Schoellman, 2019. "Extending Development Accounting," 2019 Meeting Papers 636, Society for Economic Dynamics.
    5. Bolhuis, Marijn, 2019. "Catch-Up Growth and Inter-Industry Productivity Spillovers," MPRA Paper 94730, University Library of Munich, Germany.

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