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Coping with Change: International Differences in the Returns to Skills

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  • Eric Hanushek

    ()

  • Guido Schwerdt

    ()

  • Simon Wiederhold

    ()

  • Ludger Woessmann

    ()

Abstract

Expanded international data from the PIAAC survey of adult skills allows this paper to analyze potential sources of the cross-country variation of comparably estimated labor-market returns to skills in a more diverse set of 32 countries. Returns to skills are systematically larger in countries that have grown faster in the recent past, consistent with models where skills are particularly important for adaptation to dynamic economic change. [Working Paper 22657]

Suggested Citation

  • Eric Hanushek & Guido Schwerdt & Simon Wiederhold & Ludger Woessmann, 2016. "Coping with Change: International Differences in the Returns to Skills," Working Papers id:11332, eSocialSciences.
  • Handle: RePEc:ess:wpaper:id:11332
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    References listed on IDEAS

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    1. Daniel Münich & Jan Svejnar & Katherine Terrell, 2005. "Returns to Human Capital Under The Communist Wage Grid and During the Transition to a Market Economy," The Review of Economics and Statistics, MIT Press, vol. 87(1), pages 100-123, February.
    2. Erik Hanushek & Stephen Machin & Ludger Woessmann (ed.), 2011. "Handbook of the Economics of Education," Handbook of the Economics of Education, Elsevier, edition 1, volume 4, number 4, June.
    3. Hanushek, Eric A. & Woessmann, Ludger, 2011. "The Economics of International Differences in Educational Achievement," Handbook of the Economics of Education, Elsevier.
    4. Robert C. Feenstra & Robert Inklaar & Marcel P. Timmer, 2015. "The Next Generation of the Penn World Table," American Economic Review, American Economic Association, vol. 105(10), pages 3150-3182, October.
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    7. Hanushek, Eric A. & Schwerdt, Guido & Wiederhold, Simon & Woessmann, Ludger, 2015. "Returns to skills around the world: Evidence from PIAAC," European Economic Review, Elsevier, vol. 73(C), pages 103-130.
    8. Hanushek, Eric A. & Woessmann, Ludger, 2015. "The Knowledge Capital of Nations: Education and the Economics of Growth," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262029170, January.
    9. Steven Haider & Gary Solon, 2006. "Life-Cycle Variation in the Association between Current and Lifetime Earnings," American Economic Review, American Economic Association, vol. 96(4), pages 1308-1320, September.
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    11. Schultz, Theodore W, 1975. "The Value of the Ability to Deal with Disequilibria," Journal of Economic Literature, American Economic Association, vol. 13(3), pages 827-846, September.
    12. Erik Hanushek & Stephen Machin & Ludger Woessmann (ed.), 2011. "Handbook of the Economics of Education," Handbook of the Economics of Education, Elsevier, edition 1, volume 3, number 3, June.
    13. Hanushek, Eric A. & Schwerdt, Guido & Wiederhold, Simon & Woessmann, Ludger, 2017. "Coping with change: International differences in the returns to skills," Economics Letters, Elsevier, vol. 153(C), pages 15-19.
    14. Daron Acemoglu & Pascual Restrepo, 2016. "The Race Between Machine and Man: Implications of Technology for Growth, Factor Shares and Employment," NBER Working Papers 22252, National Bureau of Economic Research, Inc.
    15. Bartel, Ann P & Lichtenberg, Frank R, 1987. "The Comparative Advantage of Educated Workers in Implementing New Technology," The Review of Economics and Statistics, MIT Press, vol. 69(1), pages 1-11, February.
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    17. Welch, F, 1970. "Education in Production," Journal of Political Economy, University of Chicago Press, vol. 78(1), pages 35-59, Jan.-Feb..
    18. Eric A. Hanushek & Guido Schwerdt & Simon Wiederhold & Ludger Woessmann, 2016. "Coping with change: International differences in returns to skills," Working Paper Series of the Department of Economics, University of Konstanz 2016-10, Department of Economics, University of Konstanz.
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    Citations

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    Cited by:

    1. Piopiunik, Marc & Schwerdt, Guido & Simon, Lisa & Woessmann, Ludger, 2018. "Skills, Signals, and Employability: An Experimental Investigation," CAGE Online Working Paper Series 357, Competitive Advantage in the Global Economy (CAGE).
    2. repec:kap:sbusec:v:52:y:2019:i:1:d:10.1007_s11187-018-0018-4 is not listed on IDEAS
    3. Monika Köppl-turyna & Michael Christl, 2018. "Returns to Skills or Returns to Tasks? A Comment on Hanushek et al. (2015)," Economics Bulletin, AccessEcon, vol. 38(2), pages 783-790.
    4. Hanushek, Eric A. & Schwerdt, Guido & Wiederhold, Simon & Woessmann, Ludger, 2017. "Coping with change: International differences in the returns to skills," Economics Letters, Elsevier, vol. 153(C), pages 15-19.
    5. Schnitzlein, Daniel D, 2019. "The relationship between trust, cognitive skills, and democracy - evidence from 30 countries around the world," Hannover Economic Papers (HEP) dp-650, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
    6. repec:nbr:nberch:13938 is not listed on IDEAS
    7. Hanushek, Eric A. & Peterson, Paul E. & Talpey, Laura M. & Woessmann, Ludger, 2019. "The Unwavering SES Achievement Gap: Trends in U.S. Student Performance," Working Paper Series rwp19-012, Harvard University, John F. Kennedy School of Government.
    8. repec:cep:cverdp:012 is not listed on IDEAS
    9. repec:ebl:ecbull:eb-18-00763 is not listed on IDEAS
    10. Eric Hanushek, 2017. "For long-term economic development, only skills matter," IZA World of Labor, Institute of Labor Economics (IZA), pages 343-343, March.
    11. Eric Hanushek, 2019. "Addressing Cross-National Generalizability in Educational Impact Evaluation," Working Papers 2019-007, Human Capital and Economic Opportunity Working Group.

    More about this item

    Keywords

    PIAAC survey; adult skills; potential sources; cross-country variation; labor-market; dynamic economic change;

    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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