IDEAS home Printed from https://ideas.repec.org/p/nip/nipewp/9-2003.html
   My bibliography  Save this paper

Local Human Capital Externalities or Sorting? Evidence From a Displaced Workers Sample

Author

Listed:

Abstract

In this paper we want to assess if the positive association between individual earnings and local average education is due to human capital externalities or just reflects some ommitted factors. Using a sample of displaced workers, we take into account firm characteristics as well as individual fixed e.ects. We find that, on average educational externalities are quite small, however it seems that these externalities are not captured equally by di.erent types of individuals. More educated workers benefit from a highly-educated environment relative to workers with lower levels of education (about 3% more) and these gains are not all acquired immediately, but through time.

Suggested Citation

  • João Carlos Cerejeira da Silva, 2003. "Local Human Capital Externalities or Sorting? Evidence From a Displaced Workers Sample," NIPE Working Papers 9/2003, NIPE - Universidade do Minho.
    • Handle: RePEc:nip:nipewp:9/2003
    as

    Download full text from publisher

    File URL: http://www3.eeg.uminho.pt/economia/nipe/docs/2003/NIPE_WP_9_2003.PDF
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Per Krusell & Lee E. Ohanian & JosÈ-Victor RÌos-Rull & Giovanni L. Violante, 2000. "Capital-Skill Complementarity and Inequality: A Macroeconomic Analysis," Econometrica, Econometric Society, vol. 68(5), pages 1029-1054, September.
    2. Andrea Ichino & Giovanni Maggi, 2000. "Work Environment and Individual Background: Explaining Regional Shirking Differentials in a Large Italian Firm," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(3), pages 1057-1090.
    3. David Card & Alan B. Krueger, 1996. "Labor Market Effects of School Quality: Theory and Evidence," Working Papers 736, Princeton University, Department of Economics, Industrial Relations Section..
    4. repec:fth:prinin:357 is not listed on IDEAS
    5. A. R. Cardoso, 2000. "Wage differentials across firms: an application of multilevel modelling," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 15(4), pages 343-354.
    6. Robert Gibbons & Lawrence Katz, 1992. "Does Unmeasured Ability Explain Inter-Industry Wage Differentials?," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 59(3), pages 515-535.
    7. Krueger, Alan B & Summers, Lawrence H, 1988. "Efficiency Wages and the Inter-industry Wage Structure," Econometrica, Econometric Society, vol. 56(2), pages 259-293, March.
    8. David Card & Thomas Lemieux, 2001. "Can Falling Supply Explain the Rising Return to College for Younger Men? A Cohort-Based Analysis," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 116(2), pages 705-746.
    9. Moretti, Enrico, 2004. "Estimating the social return to higher education: evidence from longitudinal and repeated cross-sectional data," Journal of Econometrics, Elsevier, vol. 121(1-2), pages 175-212.
    10. Roback, Jennifer, 1982. "Wages, Rents, and the Quality of Life," Journal of Political Economy, University of Chicago Press, vol. 90(6), pages 1257-1278, December.
    11. Rauch James E., 1993. "Productivity Gains from Geographic Concentration of Human Capital: Evidence from the Cities," Journal of Urban Economics, Elsevier, vol. 34(3), pages 380-400, November.
    12. Daron Acemoglu & Joshua Angrist, 2001. "How Large Are Human Capital Externalities? Evidence from Compulsory Schooling Laws," NBER Chapters, in: NBER Macroeconomics Annual 2000, Volume 15, pages 9-74, National Bureau of Economic Research, Inc.
    13. Antonio Ciccone & Giovanni Peri, 2002. "Indentifying human capital externalities: Theory with an application to US cities," Economics Working Papers 611, Department of Economics and Business, Universitat Pompeu Fabra, revised Jul 2005.
    14. David H. Autor & Lawrence F. Katz & Alan B. Krueger, 1997. "Computing Inequality: Have Computers Changed the Labor Market?," Working Papers 756, Princeton University, Department of Economics, Industrial Relations Section..
    15. David H. Autor & Lawrence F. Katz & Alan B. Krueger, 1998. "Computing Inequality: Have Computers Changed the Labor Market?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(4), pages 1169-1213.
    16. David Card & Alan Krueger, 1996. "Labor Market Effects of School Quality: Theory and Evidence," Working Papers 736, Princeton University, Department of Economics, Industrial Relations Section..
    17. repec:bla:revinw:v:44:y:1998:i:3:p:325-43 is not listed on IDEAS
    18. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863, Elsevier.
    19. David Card & Alan B. Krueger, 1996. "Labor Market Effects of School Quality: Theory and Evidence," Working Papers 736, Princeton University, Department of Economics, Industrial Relations Section..
    20. Daron Acemoglu & Joshua Angrist, 1999. "How Large are the Social Returns to Education? Evidence from Compulsory Schooling Laws," NBER Working Papers 7444, National Bureau of Economic Research, Inc.
    21. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Alexander Muravyev, 2006. "Human Capital Externalities: Evidence from the Transition Economy of Russia," Discussion Papers of DIW Berlin 629, DIW Berlin, German Institute for Economic Research.
    2. Giulio Bosio & Chiara Noè, 2011. "Higher Education Expansion, Human Capital Externalities and Wages: Italian Evidence within Occupation," Working Papers 39, AlmaLaurea Inter-University Consortium.
    3. Edna Maria Villarreal Peralta, 2011. "Rendimientos sociales de la educación en México 2005-2010," Investigaciones de Economía de la Educación volume 6, in: Antonio Caparrós Ruiz (ed.), Investigaciones de Economía de la Educación 6, edition 1, volume 6, chapter 55, pages 898-916, Asociación de Economía de la Educación.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Antonio Ciccone & Giovanni Peri, 2006. "Identifying Human-Capital Externalities: Theory with Applications," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 73(2), pages 381-412.
    2. Angel de la Fuente & Antonio Ciccone, 2003. "Human capital in a global and knowledge-based economy," UFAE and IAE Working Papers 562.03, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
    3. Antonio Ciccone & Giovanni Peri, 2002. "Indentifying human capital externalities: Theory with an application to US cities," Economics Working Papers 611, Department of Economics and Business, Universitat Pompeu Fabra, revised Jul 2005.
    4. Christopher Wheeler, 2007. "Do localization economies derive from human capital externalities?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 41(1), pages 31-50, March.
    5. Isacsson, Gunnar, 2005. "External effects of education on earnings: Swedish evidence using matched employee-establishment data," Working Paper Series 2005:10, IFAU - Institute for Evaluation of Labour Market and Education Policy.
    6. Enrico Moretti, 2004. "Workers' Education, Spillovers, and Productivity: Evidence from Plant-Level Production Functions," American Economic Review, American Economic Association, vol. 94(3), pages 656-690, June.
    7. Frederic DOCQUIER & Çaglar OZDEN & Giovanni PERI, 2010. "The Wage Effects of Immigration and Emigration," LIDAM Discussion Papers IRES 2010044, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    8. Combes, Pierre-Philippe & Duranton, Gilles & Gobillon, Laurent, 2008. "Spatial wage disparities: Sorting matters!," Journal of Urban Economics, Elsevier, vol. 63(2), pages 723-742, March.
    9. Charlot, Sylvie & Duranton, Gilles, 2004. "Communication externalities in cities," Journal of Urban Economics, Elsevier, vol. 56(3), pages 581-613, November.
    10. Mark Doms & Ethan Lewis & Alicia Robb, 2010. "Local Labor Force Education, New Business Characteristics, and Firm Performance," NBER Chapters, in: Cities and Entrepreneurship, National Bureau of Economic Research, Inc.
    11. Alberto Dalmazzo & Guido de Blasio, 2005. "Where do human capital externalities end up?," Temi di discussione (Economic working papers) 554, Bank of Italy, Economic Research and International Relations Area.
    12. Alexander Muravyev, 2006. "Human Capital Externalities: Evidence from the Transition Economy of Russia," Discussion Papers of DIW Berlin 629, DIW Berlin, German Institute for Economic Research.
    13. Eppelsheimer, Johann & Jahn, Elke J. & Rust, Christoph, 2022. "The spatial decay of human capital externalities - A functional regression approach with precise geo-referenced data," Regional Science and Urban Economics, Elsevier, vol. 95(C).
    14. Marc van der Steeg, 2005. "Why should governments intervene in education, and how effective is education policy," CPB Memorandum 122, CPB Netherlands Bureau for Economic Policy Analysis.
    15. Lewis, Ethan & Peri, Giovanni, 2015. "Immigration and the Economy of Cities and Regions," Handbook of Regional and Urban Economics, in: Gilles Duranton & J. V. Henderson & William C. Strange (ed.), Handbook of Regional and Urban Economics, edition 1, volume 5, chapter 0, pages 625-685, Elsevier.
    16. Enrico Moretti, 2013. "Real Wage Inequality," American Economic Journal: Applied Economics, American Economic Association, vol. 5(1), pages 65-103, January.
    17. Caselli, Francesco, 2005. "Accounting for Cross-Country Income Differences," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 9, pages 679-741, Elsevier.
    18. Luis Eduardo Arango & Gabriela Bonilla, 2015. "Human capital agglomeration and social returns to education in Colombia," Borradores de Economia 12788, Banco de la Republica.
    19. Bibhudutta Panda, 2017. "Schooling and productivity growth: evidence from a dual growth accounting application to U.S. states," Journal of Productivity Analysis, Springer, vol. 48(2), pages 193-221, December.
    20. Antonio Ciccone & Giovanni Peri, "undated". "Human Capital and Externalities in Cities," Working Papers 172, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.

    More about this item

    Keywords

    Capital Externalities; Education; Wages; Agglomeration.;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nip:nipewp:9/2003. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: NIPE (email available below). General contact details of provider: https://edirc.repec.org/data/nipampt.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.