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Quality of Work Experience and Economic Development—Estimates using Canadian Immigrant Data

  • Serge Coulombe

    ()

    (Department of Economics, University of Ottawa, Ottawa, ON)

  • Gilles Grenier

    ()

    (Department of Economics, University of Ottawa, Ottawa, ON)

  • Serge Nadeau

    ()

    (Department of Economics, University of Ottawa, Ottawa, ON)

There is increasing evidence in the economic development literature that the quality of schooling considerably varies across countries that are at different stages in their economic development. However, an issue that has been overlooked is the role of the quality of work experience in explaining differences in economic development. This paper uses Canadian census data on immigrant earnings to show that per capita GDP in the country of origin can be used as a quality indicator for both education and work experience. Coefficients estimated from immigrant earnings regressions are then used to estimate the effects of difference in human capital quality on development gaps between rich and poor countries. The analysis shows that while differences in the quality of schooling account for substantial differences in living standards across countries, differences in the quality of work experience can account for even more. Policywise, our results suggest that the immediate effects of improving the quality and the quantity of schooling in less-developed countries might be rather limited if labour-market institutions and ways of doing things are not changed at the same time to improve the quality of work experience.

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File URL: http://sciencessociales.uottawa.ca/economics/sites/socialsciences.uottawa.ca.economics/files/1109E.pdf
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Paper provided by University of Ottawa, Department of Economics in its series Working Papers with number 1109E.

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Length: 37 pages
Date of creation: 2011
Date of revision:
Handle: RePEc:ott:wpaper:1109e
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  1. Nicholas Bloom & Christos Genakos & Raffaella Sadun & John Van Reenen, 2012. "Management Practices Across Firms and Countries," NBER Working Papers 17850, National Bureau of Economic Research, Inc.
  2. Chiswick, Barry R. & Miller, Paul W., 2009. "The international transferability of immigrants' human capital," Economics of Education Review, Elsevier, vol. 28(2), pages 162-169, April.
  3. Bloom, Nicholas & Van Reenen, John, 2010. "Human Resource Management and Productivity," CEPR Discussion Papers 7849, C.E.P.R. Discussion Papers.
  4. Andrés Erosa & Tatyana Koreshkova & Diego Restuccia, 2010. "How Important Is Human Capital? A Quantitative Theory Assessment of World Income Inequality," Review of Economic Studies, Oxford University Press, vol. 77(4), pages 1421-1449.
  5. Tommaso Porzio & Todd Schoellman & Nancy Qian & Benjamin Moll & David Lagakos, 2014. "Lifecycle Human Capital Accumulation Across Countries: Lessons From U.S. Immigrants," 2014 Meeting Papers 777, Society for Economic Dynamics.
  6. Coulombe Serge & Tremblay Jean-François, 2006. "Literacy and Growth," The B.E. Journal of Macroeconomics, De Gruyter, vol. 6(2), pages 1-34, August.
  7. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 407-437.
  8. Nicholas Bloom & John Van Reenen, 2007. "Measuring and Explaining Management Practices Across Firms and Countries," The Quarterly Journal of Economics, Oxford University Press, vol. 122(4), pages 1351-1408.
  9. Angel de la Fuente & Rafael Doménech, 2006. "Human Capital in Growth Regressions: How Much Difference Does Data Quality Make?," Journal of the European Economic Association, MIT Press, vol. 4(1), pages 1-36, 03.
  10. Jacob A. Mincer, 1974. "Introduction to "Schooling, Experience, and Earnings"," NBER Chapters, in: Schooling, Experience, and Earnings, pages 1-4 National Bureau of Economic Research, Inc.
  11. Eric A. Hanushek & Ludger Woessmann, 2008. "The Role of Cognitive Skills in Economic Development," Journal of Economic Literature, American Economic Association, vol. 46(3), pages 607-68, September.
  12. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, September.
  13. Sweetman, Arthur, 2004. "Immigrant Source Country Educational Quality and Canadian Labour Market Outcomes," Analytical Studies Branch Research Paper Series 2004234e, Statistics Canada, Analytical Studies Branch.
  14. Serge Coulombe & Jean-Francois Tremblay, 2009. "Migration and Skills Disparities across the Canadian Provinces," Regional Studies, Taylor & Francis Journals, vol. 43(1), pages 5-18.
  15. Kenneth J. Arrow, 1962. "The Economic Implications of Learning by Doing," Review of Economic Studies, Oxford University Press, vol. 29(3), pages 155-173.
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