IDEAS home Printed from https://ideas.repec.org/p/zbw/hwwirp/1-32.html
   My bibliography  Save this paper

Local human capital, segregation by skill, and skill-specific employment growth

Author

Listed:
  • Schlitte, Friso

Abstract

Labour markets in most highly developed countries are marked by rising levels of skill segregation in the production process and increasing inequalities in skill-specific employment prospects. The local skill structure is frequently regarded as a major cause for regional growth disparities. There are several studies investigating the influence of the local human capital endowment on qualification-specific wages levels. Furthermore, theoretical studies suggest that skill segregation might matter for the polarisation of wages and employment. However, analyses on regional employment growth by different skill levels are still scarce and empirical evidence on the effects of skill segregation on qualification-specific employment is completely lacking. This paper investigates the effects of the local skill composition and skill segregation in the production process on qualification-specific employment growth in West German regions. This study provides first evidence for negative effects of skill segregation on low-skilled employment growth. Furthermore, the results show that a large share of local high-skilled employment does not foster further regional concentration of human capital but positively affects the employment prospects of less skilled workers.

Suggested Citation

  • Schlitte, Friso, 2010. "Local human capital, segregation by skill, and skill-specific employment growth," HWWI Research Papers 1-32, Hamburg Institute of International Economics (HWWI).
    • Handle: RePEc:zbw:hwwirp:1-32
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/48210/1/640171788.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Judith K. Hellerstein & David Neumark, 2008. "Workplace Segregation in the United States: Race, Ethnicity, and Skill," The Review of Economics and Statistics, MIT Press, vol. 90(3), pages 459-477, August.
    2. Stüber, Heiko & Beissinger, Thomas, 2012. "Does downward nominal wage rigidity dampen wage increases?," European Economic Review, Elsevier, vol. 56(4), pages 870-887.
    3. Kremer, M & Maskin, E, 1996. "Wage Inequality and Segregation by Skill," Working papers 96-23, Massachusetts Institute of Technology (MIT), Department of Economics.
    4. Lindbeck, Assar & Snower, Dennis J, 1996. "Reorganization of Firms and Labor-Market Inequality," American Economic Review, American Economic Association, vol. 86(2), pages 315-321, May.
    5. 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.
    6. Danzer, Alexander M. & Yaman, Firat, 2010. "Ethnic Concentration and Language Fluency of Immigrants in Germany," IZA Discussion Papers 4742, Institute of Labor Economics (IZA).
    7. Jahn, Elke J. & Rosholm, Michael, 2010. "Looking Beyond the Bridge: How Temporary Agency Employment Affects Labor Market Outcomes," Working Papers 10-6, University of Aarhus, Aarhus School of Business, Department of Economics.
    8. Stegmaier, Jens, 2010. "Effects of workplace representation on firm-provided further training in Germany," IAB-Discussion Paper 201014, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    9. John C. Driscoll & Aart C. Kraay, 1998. "Consistent Covariance Matrix Estimation With Spatially Dependent Panel Data," The Review of Economics and Statistics, MIT Press, vol. 80(4), pages 549-560, November.
    10. Edward Ludwig Glaeser & Albert Saiz, 2003. "The rise of the skilled city," Working Papers 04-2, Federal Reserve Bank of Philadelphia.
    11. Daron Acemoglu, 1999. "Changes in Unemployment and Wage Inequality: An Alternative Theory and Some Evidence," American Economic Review, American Economic Association, vol. 89(5), pages 1259-1278, December.
    12. David H. Autor & Frank Levy & Richard J. Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, issue Nov.
    13. Daron Acemoglu, 1998. "Why Do New Technologies Complement Skills? Directed Technical Change and Wage Inequality," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(4), pages 1055-1089.
    14. Alan Manning, 2004. "We Can Work It Out: The Impact of Technological Change on the Demand for Low‐Skill Workers," Scottish Journal of Political Economy, Scottish Economic Society, vol. 51(5), pages 581-608, November.
    15. Sergio Rey & Brett Montouri, 1999. "US Regional Income Convergence: A Spatial Econometric Perspective," Regional Studies, Taylor & Francis Journals, vol. 33(2), pages 143-156.
    16. Daniel Hoechle, 2007. "Robust standard errors for panel regressions with cross-sectional dependence," Stata Journal, StataCorp LP, vol. 7(3), pages 281-312, September.
    17. Glaeser, Edward L. & Scheinkman, JoseA. & Shleifer, Andrei, 1995. "Economic growth in a cross-section of cities," Journal of Monetary Economics, Elsevier, vol. 36(1), pages 117-143, August.
    18. Daron Acemoglu, 2002. "Directed Technical Change," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 69(4), pages 781-809.
    19. Jens Suedekum & Uwe Blien, 2004. "Wages and Employment Growth: Disaggregated Evidence for West Germany," ERSA conference papers ersa04p641, European Regional Science Association.
    20. 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.
    21. Duranton, Gilles, 2004. "The economics of production systems: Segmentation and skill-biased change," European Economic Review, Elsevier, vol. 48(2), pages 307-336, April.
    22. Alan Manning, 2004. "We Can Work It Out: the Impact of Technological Change on the Demand for Low Skill Workers," CEP Discussion Papers dp0640, Centre for Economic Performance, LSE.
    23. Adrian Wood, 2002. "Globalization and wage inequalities: A synthesis of three theories," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 138(1), pages 54-82, March.
    24. Moretti, Enrico, 2004. "Human capital externalities in cities," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 51, pages 2243-2291, Elsevier.
    25. Wölfel, Oliver & Heineck, Guido, 2012. "Parental risk attitudes and children's secondary school track choice," Economics of Education Review, Elsevier, vol. 31(5), pages 727-743.
    26. Nickell, Stephen & Bell, Brian, 1995. "The Collapse in Demand for the Unskilled and Unemployment across the OECD," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 11(1), pages 40-62, Spring.
    27. Südekum, Jens, 2008. "Convergence of the skill composition across German regions," Regional Science and Urban Economics, Elsevier, vol. 38(2), pages 148-159, March.
    28. Drechsler, Jörg, 2010. "Multiple imputation of missing values in the wave 2007 of the IAB Establishment Panel," IAB-Discussion Paper 201006, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    29. Daron Acemoglu, 1996. "A Microfoundation for Social Increasing Returns in Human Capital Accumulation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 111(3), pages 779-804.
    30. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    31. 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.
    32. Boyan Jovanovic & Rafael Rob, 1989. "The Growth and Diffusion of Knowledge," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 56(4), pages 569-582.
    33. Maarten Goos & Alan Manning, 2007. "Lousy and Lovely Jobs: The Rising Polarization of Work in Britain," The Review of Economics and Statistics, MIT Press, vol. 89(1), pages 118-133, February.
    34. repec:hoo:wpaper:e-95-4 is not listed on IDEAS
    35. Freeman, Richard, 1995. "The Limits of Wage Flexibility to Curing Unemployment," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 11(1), pages 63-72, Spring.
    36. Sabine Klinger & Thomas Rothe, 2012. "The Impact of Labour Market Reforms and Economic Performance on the Matching of the Short‐term and the Long‐term Unemployed," Scottish Journal of Political Economy, Scottish Economic Society, vol. 59(1), pages 90-114, February.
    37. Simon, Curtis J., 1998. "Human Capital and Metropolitan Employment Growth," Journal of Urban Economics, Elsevier, vol. 43(2), pages 223-243, March.
    38. Daniel Heuermann & Benedikt Halfdanarson & Jens Suedekum, 2010. "Human Capital Externalities and the Urban Wage Premium: Two Literatures and their Interrelations," Urban Studies, Urban Studies Journal Limited, vol. 47(4), pages 749-767, April.
    39. Konle-Seidl, Regina, 2010. "Make further vocational training pay : possibilities and limits of promoting transitions by Public Employment Services (PES)," IAB-Discussion Paper 201018, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    40. Jens Suedekum & Uwe Blien & Johannes Ludsteck, 2006. "What has caused regional employment growth differences in Eastern Germany?," Review of Regional Research: Jahrbuch für Regionalwissenschaft, Springer;Gesellschaft für Regionalforschung (GfR), vol. 26(1), pages 51-73, March.
    41. Rebien, Martina, 2010. "The use of social networks in recruiting processes from a firms perspective," IAB-Discussion Paper 201005, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    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. Gavilan, Angel, 2012. "Wage inequality, segregation by skill and the price of capital in an assignment model," European Economic Review, Elsevier, vol. 56(1), pages 116-137.
    2. Magda, Iga & Marsden, David & Moriconi, Simone, 2016. "Lower coverage but stronger unions? Institutional changes and union wage premia in Central Europe," Journal of Comparative Economics, Elsevier, vol. 44(3), pages 638-656.
    3. Concetta Mendolicchio & Dimitri Paolini & Tito Pietra, 2014. "Income Taxes, Subsidies to Education, and Investments in Human Capital," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 16(1), pages 24-47, February.
    4. Drasch, Katrin, 2011. "Do changing institutional settings matter? : educational attainment and family related employment interruptions in Germany," IAB-Discussion Paper 201113, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    5. Viktor A. Venhorst, 2017. "Human capital spillovers in Dutch cities: consumption or productivity?," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 59(3), pages 793-817, November.
    6. Osiander, Christopher & Steinke, Joß, 2011. "Street-level bureaucrats in der Arbeitsverwaltung : Dienstleistungsprozesse und reformierte Arbeitsvermittlung aus Sicht der Vermittler," IAB-Discussion Paper 201115, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    7. Werner, Daniel, 2013. "Regional convergence analysis for skill-specific employment groups," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79706, Verein für Socialpolitik / German Economic Association.
    8. Zabel, Cordula, 2011. "Lone mothers' participation in labor market programs for means-tested benefit recipients in Germany," IAB-Discussion Paper 201114, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    9. Zhenshan Yang, 2019. "Threshold Effect of Poverty Alleviation Funds on Human Capital Accumulation: A Case Study of Impoverished Counties in China," Sustainability, MDPI, vol. 11(3), pages 1-12, February.
    10. Alessandra Faggian & Isha Rajbhandari & Kathryn R. Dotzel, 2017. "The interregional migration of human capital and its regional consequences: a review," Regional Studies, Taylor & Francis Journals, vol. 51(1), pages 128-143, January.

    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. Schlitte, Friso & Böttcher, Fabian & Niebuhr, Annekatrin & Diez, Javier Revilla, 2010. "The determinants of regional disparities in skill segregation: Evidence from a cross section of German regions," HWWI Research Papers 1-36, Hamburg Institute of International Economics (HWWI).
    2. John V. Winters, 2013. "Human capital externalities and employment differences across metropolitan areas of the USA," Journal of Economic Geography, Oxford University Press, vol. 13(5), pages 799-822, September.
    3. Ana María Díaz, 2011. "The Employment Advantages of Skilled Urban Areas," Vniversitas Económica 10087, Universidad Javeriana - Bogotá.
    4. Ana María Díaz, 2013. "The Employment Advantages of Skilled Urban Municipalities in Colombia," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 31(70), pages 316-366, July.
    5. Kaplanis, Ioannis, 2010. "Wage effects from changes in local human capital in Britain," LSE Research Online Documents on Economics 33615, London School of Economics and Political Science, LSE Library.
    6. Liu, Shimeng & Yang, Xi, 2021. "Human capital externalities or consumption spillovers? The effect of high-skill human capital across low-skill labor markets," Regional Science and Urban Economics, Elsevier, vol. 87(C).
    7. Kirby, Simon & Riley, Rebecca, 2008. "The external returns to education: UK evidence using repeated cross-sections," Labour Economics, Elsevier, vol. 15(4), pages 619-630, August.
    8. Südekum Jens, 2010. "Human Capital Externalities and Growth of High- and Low-Skilled Jobs," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 230(1), pages 92-114, February.
    9. Bratti, Massimiliano & Leombruni, Roberto, 2014. "Local human capital externalities and wages at the firm level: Evidence from Italian manufacturing," Economics of Education Review, Elsevier, vol. 41(C), pages 161-175.
    10. Luis Eduardo Arango & Gabriela Bonilla, 2015. "Human capital agglomeration and social returns to education in Colombia," Borradores de Economia 12788, Banco de la Republica.
    11. Dürnberger, Andrea & Drasch, Katrin & Matthes, Britta, 2010. "Kontextgestützte Abfrage in Retrospektiverhebungen: Ein kognitiver Pretest zu Erinnerungsprozessen bei Weiterbildungsereignissen," IAB-Discussion Paper 201020, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    12. Achatz, Juliane & Trappmann, Mark, 2011. "Arbeitsmarktvermittelte Abgänge aus der Grundsicherung : der Einfluss von personen- und haushaltsgebundenen Barrieren," IAB-Discussion Paper 201102, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany].
    13. Daniel F. Heuermann, 2009. "Career Networks and Job Matching - Evidence on the Microeconomic Foundations of Human Capital Externalities," IAAEG Discussion Papers until 2011 200901, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
    14. Acemoglu, Daron & Autor, David, 2011. "Skills, Tasks and Technologies: Implications for Employment and Earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 4, chapter 12, pages 1043-1171, Elsevier.
    15. Werner, Daniel, 2013. "Regional convergence analysis for skill-specific employment groups," VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79706, Verein für Socialpolitik / German Economic Association.
    16. Daniel Heuermann & Benedikt Halfdanarson & Jens Suedekum, 2010. "Human Capital Externalities and the Urban Wage Premium: Two Literatures and their Interrelations," Urban Studies, Urban Studies Journal Limited, vol. 47(4), pages 749-767, April.
    17. Jaison Abel & Todd Gabe, 2011. "Human Capital and Economic Activity in Urban America," Regional Studies, Taylor & Francis Journals, vol. 45(8), pages 1079-1090.
    18. Ioannis Kaplanis, 2010. "Local Human Capital and Its Impact on Local Employment Chances in Britain," SERC Discussion Papers 0040, Centre for Economic Performance, LSE.
    19. Carlino, Gerald & Kerr, William R., 2015. "Agglomeration and Innovation," 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 349-404, Elsevier.
    20. Duranton, Gilles & Puga, Diego, 2014. "The Growth of Cities," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 2, chapter 5, pages 781-853, Elsevier.

    More about this item

    Keywords

    regional employment growth; low-skilled employment; skill segregation;
    All these keywords.

    JEL classification:

    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

    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:zbw:hwwirp:1-32. 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: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/hwwiide.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.