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Optimal higher education enrollment and productivity externalities in a two-sector model

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  • Volker Meier
  • Ioana Schiopu

Abstract

We investigate externalities in higher education enrollment over the course of development in a two-sector model. Each sector works with only one type of labor, skilled or unskilled, and individuals are differentiated according to their cost of acquiring human capital. Both sectors exhibit productivity externalities in the size of the skill-specific labor and in the average human capital of workers. When skill-biased technological change prevails, it may well be the case that intermediate stages of development witness underenrollment in higher education, while highly developed economies experience overenrollment.

Suggested Citation

  • Volker Meier & Ioana Schiopu, 2013. "Optimal higher education enrollment and productivity externalities in a two-sector model," ifo Working Paper Series 170, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    • Handle: RePEc:ces:ifowps:_170
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    Cited by:

    1. Volker Meier & Ioana Cosmina Schiopu, 2015. "Why Academic Quality in Higher Education Declines," CESifo Working Paper Series 5480, CESifo.
    2. Adhitya, Dhian & Samudro, Bhimo Rizky, 2019. "The Role of Cognitive and Non-Cognitive Skills on Labour Market Outcomes in Indonesia," Jurnal Ekonomi Malaysia, Faculty of Economics and Business, Universiti Kebangsaan Malaysia, vol. 53(1), pages 3-16.
    3. Meier, Volker & Schiopu, Ioana, 2020. "Enrollment expansion and quality differentiation across higher education systems," Economic Modelling, Elsevier, vol. 90(C), pages 43-53.

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    More about this item

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General

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