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Are there social returns to both firm-level and regional human capital? – Evidence from German social security data

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  • Nils Braakmann

    () (Institute of Economics, Leuphana University of Lüneburg, Germany)

Abstract

This paper provides first evidence on the social returns to education from both firm-level and regional human capital. Using panel data from German social security, both at an individual and aggregated at the plant and regional level, I estimate earnings functions incorporating measures of regional and firm-level human capital while controlling for various types of unobserved heterogeneity, demand shocks, regional physical capital and other regional and firm-level confounders. The results suggest negligibly small external returns to the firm-level shares of high-skilled workers. On the regional level, the results show no support for external returns to education, except for skilled workers.

Suggested Citation

  • Nils Braakmann, 2009. "Are there social returns to both firm-level and regional human capital? – Evidence from German social security data," Working Paper Series in Economics 143, University of Lüneburg, Institute of Economics.
  • Handle: RePEc:lue:wpaper:143
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    More about this item

    Keywords

    Human capital externalities; social returns to education; error-component model;

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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