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Wage effects from changes in local human capital in Britain

  • Kaplanis, Ioannis

This paper examines the impact of local human capital on individuals’ wages through external effects. Employing wage regressions, it is found that changes in individuals’ wages are positively associated with changes in the shares of high-paid occupation workers in the British travel-to-work-areas for the late 1990s. I examine this positive association for different occupational groups (defined by pay) in order to disentangle between production function and consumer demand driven theoretical explanations. The wage effect is found to be stronger and significant for the bottom-paid occupational quintile compared to the middle-paid ones, and using also sectoral controls the paper argues to provide evidence for the existence of consumer demand effects.

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File URL: http://hdl.handle.net/2072/179614
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Paper provided by Universitat Rovira i Virgili, Department of Economics in its series Working Papers with number 2072/179614.

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Date of creation: 2011
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Handle: RePEc:urv:wpaper:2072/179614
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