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Human Capital Investment in the Presence of Unemployment: Application to University Enrolment in Spain


  • Rosa M. Fernandez
  • Etsuro Shioji


This paper explores the effects of unemployment on the school enrolment decisions. A few studies that have taken up this issue in the past have produced results that are seemingly contradictory with each other. We build a model of the enrolment decision that is capable of explaining these results in a unified manner. In this model, unemployment affects the enrolment decision both through changing costs of and returns to education (investment effect) and through changing parental wealth and thus affecting intergenerational transfers (wealth effect). We develop an empirical framework that allows us to test presence of these two effects separately, and apply this to panel data of Spanish regions on university enrolment. We find that both effects are present.

Suggested Citation

  • Rosa M. Fernandez & Etsuro Shioji, 2001. "Human Capital Investment in the Presence of Unemployment: Application to University Enrolment in Spain," Economics Series Working Papers 66, University of Oxford, Department of Economics.
  • Handle: RePEc:oxf:wpaper:66

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    Cited by:

    1. Hermann, Zoltán, 2005. "A helyi munkaerőpiac hatása a középfokú továbbtanulási döntésekre
      [The local labour markets effect on decisions to enter secondary-level education]
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(1), pages 39-60.
    2. Stöver, Britta, 2017. "Empirical evidence in explaining the transition behaviour from school to studies - challenges in forecasting the number of first-year students in Germany," Hannover Economic Papers (HEP) dp-596, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
    3. Mikkel Barslund, 2012. "Recent Developments in Selected Education Indicators and their Relation to Europe 2020 Targets," National Institute Economic Review, National Institute of Economic and Social Research, vol. 220(1), pages 6-16, April.
    4. Budria, Santiago, 2006. "Education and Inequality: Evidence from Spain," MPRA Paper 1098, University Library of Munich, Germany.

    More about this item


    education; participation; unemployment; intergenerational transfers; opportunity costs;

    JEL classification:

    • I1 - Health, Education, and Welfare - - Health
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J6 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers


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