nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2005‒12‒01
37 papers chosen by
Fabio Sabatini
Universitá degli Studi di Roma, La Sapienza

  1. Like father, like son: Social networks, human capital investment, and social mobility By Calvo-Armengol, Antoni; Jackson, Matthew O.
  2. Do human capital and fund characteristics drive follow-up behaviour of early stage high tech vcs? By Knockaert, M.; Lockett, A.; Clarysse, B.; Wright, M.
  3. The Complementarity and Self Productivity of Human Capital Investments in a SDGE Economy with Altruism and Lifetime Liquidity Constraints By Flavio Cunha
  4. Education Decisions, Equilibrium Policies and Wages Dispersion By Gianluca Violante; Giovanni Gallipoli; Costas Meghir
  5. Is Human Capital Losing from Outsourcing? Evidence for Austria and Poland By Lorentowicz, Andzelika; Marin, Dalia; Raubold, Alexander
  6. Human Capital Risk, Stockholder Consumption, and Asset Returns By Christopher Malloy; Tobias Moskowitz
  7. The Returns to Schooling and Ability During the Early Career: Evidence on Employer Learning and Post-School Investment By Fabian Lange
  8. Assessing The Impact of Skill Shortages on the Productivity Performance of High-Tech Firms in Northern Ireland By Jessica Bennett; Seamus McGuinness
  9. The Impact of Training on Productivity and Wages: Evidence from British Panel Data By Lorraine Dearden; Howard Reed; John Van Reenen
  10. Product Market Competition Returns to Skill and Wage Inequality By Maria Guadalupe
  11. Evaluating the Dynamic Employment Effects of Training Programs in East Germany Using Conditional Difference-in-Differences By Annette Bergemann; Bernd Fitzenberger; Stefan Speckesser
  12. Intra and Inter-Generational Changes in the Returns to Schooling 1991-2002 By Seamus McGuinness; Jessica Bennett
  13. Search Equilibrium, Production Parameters and Social Returns to Education: Theory and Estimation By Andrey Launov; Christian Holzner
  14. Returns to education in Bangladesh By M Niaz Asadullah
  15. From the Cradle to the Labor Market? The Effect of Birth Weight on Adult Outcomes By Sandra E. Black; Paul J. Devereux; Kjell Salvanes
  16. Choice and Competition in Local Education Markets By Patrick Bayer; Robert McMillan
  17. A general equilibrium analysis of parental leave policies By Andres Erosa; Luisa Fuster; Diego Restuccia
  18. Does the Early Bird Catch the Worm? Instrumental Variable Estimates of Educational Effects of Age of School Entry in Germany By Patrick Puhani; Andrea Maria Weber
  19. Age at Immigration and School Performance: A Siblings Analysis Using Swedish Register Data By Böhlmark, Anders
  20. Assortative Marriage and the Effects of Government Homecare Provision Programs on Gender Wage and Participation Inequality By Han, Seungjin; Bjerk, David
  21. A quantitative theory of the gender gap in wages By Andres Erosa; Luisa Fuster; Diego Restuccia
  22. Childhood Family Structure and Schooling Outcomes: Evidence for Germany By Marco Francesconi; Stephen P. Jenkins; Thomas Siedler
  23. The Gender Gap in Early Career Wage Growth By Alan Manning; Joanna Swaffield
  24. Performance Pay for Teachers: Linking Individual and Organisational Level Targets By Richard Belfield; David Marsden
  25. The De-Collectivisation of Pay Setting in Britain 1990-1998: Incidence, Determinants and Impact By A Charlwood
  26. Computing the True Spread By Ralf Martin
  27. Technology Adoption, Learning by Doing, and Productivity: A Study from Steel Refining Furnaces By Hiroshi Ohashi; Tsuyoshi Nakamura
  28. Efficiency potential and efficiency variation in Norwegian lower secondary schools By Lars-Erik Borge; Linn Renée Naper, Department of Economics, Norwegian University of Science and Technology
  29. A RELAÇÃO ENTRE O DESEMPENHO ESCOLAR E OS SALÁRIOS NO BRASIL By Andréa Zaitune Curi; Naércio Aquino Menezes-Filho
  30. CHILDREN IN BRAZIL: HEALTH, EDUCATION AND WORK By Carine Milcent; Jack Huguenin; Danielle Carusi-Machado

  1. By: Calvo-Armengol, Antoni; Jackson, Matthew O.
    Abstract: We build a model where an individual sees higher returns to investments in human capital when their neighbors in a social network have higher levels of human capital. We show that the correlation of human capital across generations of a given family is directly related to the sensitivity of individual investment decisions to the state of the social network. Increasing the sensitivity leads to increased intergenerational correlation, as well as more costly investment decisions on average in the society. We calibrate a simple threshold version of the model to data from a variety of EU nations. We also show how directly analyzing sensitivity of decisions to social circumstances can lead to information that is not captured by intergenerational correlation.
    Date: 2005–11
  2. By: Knockaert, M.; Lockett, A.; Clarysse, B.; Wright, M.
    Abstract: This paper uses a unique dataset to examine the neglected but important issue concerning the relationship between the human capital and fund characteristics of venture capitalists and post-investment follow-up behavior in early stage high tech investments. We found no indication that involvement in monitoring activities by the investment manager is determined by either fund or human capital characteristics. In relation to value-adding activities, human capital variables were the most important, with previous consulting experience and entrepreneurial experience contributing to a higher involvement in value-adding activities. Furthermore, the diversity of an investment manager’s portfolio was negatively related to involvement in value-adding activities. Finally, with respect to fund level characteristics, we found that investment managers of captive funds were less involved in value-adding activities.
    Keywords: venture capital, early stage high tech firms, post-investment follow-up behavior, human capital, fund characteristics
    Date: 2005–11–18
  3. By: Flavio Cunha (Department of Economics University of Chicago)
    Keywords: Human Capital Investments, Inequality
    JEL: J24 D31
    Date: 2005
  4. By: Gianluca Violante; Giovanni Gallipoli (Economics University College London); Costas Meghir
    Keywords: Education, Inequality, Equilibrium, Policy
    JEL: J20 J24 E20 E60
    Date: 2005
  5. By: Lorentowicz, Andzelika; Marin, Dalia; Raubold, Alexander
    Abstract: Feenstra and Hanson (1997) have argued in the context of the North American Free Trade Agreement that US outsourcing to Mexico leads to an increase in the skill premium in both the US and Mexico. In this paper we show on the example of Austria and Poland that with the new international division of labor emerging in Europe Austria, the high income country, is specializing in the low skill intensive part of the value chain and Poland, the low income country, is specializing in the high skill part. As a result, skilled workers in Austria are losing from outsourcing, while gaining in Poland. In Austria, relative wages for human capital declined by 2 percent during 1995-2002 and increased by 41 percent during 1994-2002 in Poland. In both countries outsourcing contributes roughly 35 percent to these changes in the relative wages for skilled workers. Furthermore, we show that Austria?s R&D policy has contributed to an increase in the skill premium there.
    JEL: P45 J31 F23 F21
    Date: 2005–10
  6. By: Christopher Malloy (London Business School London Business School); Tobias Moskowitz
    Keywords: Human capital, stock returns, job creation and destruction
    JEL: G12
    Date: 2005
  7. By: Fabian Lange (Economics Yale University)
    Date: 2005
  8. By: Jessica Bennett; Seamus McGuinness (Economic Research Institute of Northern Ireland)
    Abstract: This paper utilises data from three separate skill related surveys of firms in the Northern Ireland IT, Electronic Engineering and Mechanical Engineering industries in order to assess the extent to which the performance of high-tech firms are being constrained as a result of hard-to-fill and / or unfilled vacancies. Whist it was found that the determinants of skill shortage varied somewhat depending upon the definitional approach adopted, a high degree of correlation was found. With regards to the impacts of skill shortages on firm level performance, it was found that both hard-to-fill and unfilled vacancies had reduced output per worker levels by between 65 and 75 per cent in affected firms, however, these impacts were only detectable after controlling for selection effects. The evidence suggests that standard OLS procedures can generate highly misleading results in studies of this nature.
    Date: 2005–10
  9. By: Lorraine Dearden; Howard Reed; John Van Reenen
    Abstract: It is standard in the literature on training to use wages as a sufficient statistic for productivity. But there aremany reasons why wages and productivity may diverge. This paper is part of a smaller literature on the effectsof work-related training on direct measures of productivity. We construct a panel of British industries between1983 and 1996 containing training, productivity and wages. Using a variety of econometric estimationtechniques (including system GMM) we find that training is associated with significantly higher productivity.Raising the proportion of workers trained in an industry by one percentage point (say from the average of 10%to 11%) is associated with an increase in value added per worker of about 0.6% and an increase in wages ofabout 0.3%. Furthermore, we find that the magnitude of the impact of training on wages is only half as large asthe impact of training on productivity, implying that the existing literature has underestimated the importance oftraining. We also show evidence using complementary datasets (e.g. from individuals) that is suggestive ofexternalities of training and imperfect competition.
    Keywords: Productivity, training, wages, panel data
    JEL: J31 C23 D24
    Date: 2005–02
  10. By: Maria Guadalupe
    Abstract: This paper shows that increasing product market competition can have a direct impact on theemployment relationship and on wage inequality. I develop a simple model in which anincrease in product market competition increases returns to skill through the effect ofcompetition on the sensitivity of profits to cost reductions. I then show empirically thatrelative wages increase with competition using a large panel of United Kingdom workerswith complete work histories. I identify the impact of competition on returns to skill in thepanel, using two exogenous measures of competition provided by two quasi-naturalexperiments. Quantile regressions indicate that increased competition also raised returns tounobserved ability.
    Keywords: Wage Structure, Returns to Skill, Product Market Competition
    JEL: J31 J33 L22 D21
    Date: 2005–05
  11. By: Annette Bergemann (Free University of Amsterdam and IZA Bonn); Bernd Fitzenberger (Goethe University of Frankfurt, ZEW, IFS and IZA Bonn); Stefan Speckesser (Policy Studies Institute, London)
    Abstract: This study analyzes the employment effects of training in East Germany. We propose and apply an extension of the widely used conditional difference-in-differences evaluation method. Focusing on transition rates between nonemployment and employment we take into account that employment is a state dependent process. Our results indicate that using transition rates is more appropriate and informative than using unconditional employment rates as commonly done in the literature. Training as a first participation in a program of Active Labor Market Policies shows zero to small positive effects both on reemployment probabilities and on probabilities of remaining employed with notable variation over the different start dates of the program.
    Keywords: evaluation of active labor market policy in East Germany, nonparametric matching, conditional difference-in-differences, employment dynamics, Ashenfelter's Dip, bootstrap
    JEL: C14 C23 H43 J64 J68
    Date: 2005–11
  12. By: Seamus McGuinness; Jessica Bennett (Economic Research Institute of Northern Ireland)
    Abstract: This paper uses British Household Panel Survey (BHPS) data from 1991 to 2002 to assess the extent to which labour market returns have been affected by changes in the nature of educational supply. We find that whilst there have been substantial shifts in the returns to schooling over the period, these effects are much more pronounced for younger workers. The most notable change was the complete elimination of the premium for GCSE’s over no qualifications for both males and females under 30, and the fall in the returns to vocational degrees for young males. The disappearance of the GCSE premium, which is linked to a rising demand for low qualified workers, was found to temper the rise in inequality whilst the rise in educational participation was found to substantially increase male graduate wage dispersion.
    Date: 2005–10
  13. By: Andrey Launov; Christian Holzner (Social Policy and Labor Markets IFOInstitute for Economic Research)
    Keywords: Search, wage correlation, social returns to education
    JEL: J21 J23 J64
    Date: 2005
  14. By: M Niaz Asadullah (Oxford University)
    Abstract: This paper reports labour market returns to education in Bangladesh using data from recent nationwide household survey. Returns are estimated separately for rural and urban samples, males, females and private sector employees. Substantial heterogeneity in returns is observed; e.g. estimates are higher for urban (than rural sample) and female samples (compared to their male counterparts). Our ordinary least square estimates of returns to education are robust to control for types of schools attended by individuals and selection into wage work.
    Keywords: Education, labor market participation, sample selection, Bangladesh
    JEL: O P
    Date: 2005–11–19
  15. By: Sandra E. Black; Paul J. Devereux; Kjell Salvanes
    Abstract: Lower birth weight babies have worse outcomes, both short-run in terms of one-year mortality rates and longer run in terms of educational attainment and earnings. However, recent research has called into question whether birth weight itself is important or whether it simply reflects other hard-to-measure characteristics. By applying within twin techniques using a unique dataset from Norway, we examine both short-run and long-run outcomes for the same cohorts. We find that birth weight does matter; very small short-run fixed effect estimates can be misleading because longer-run effects on outcomes such as height, IQ, earnings, and education are significant and similar in magnitude to OLS estimates. Our estimates suggest that eliminating birth weight differences between socio-economic groups would have sizeable effects on the later outcomes of children from poorer families.
    JEL: J1 I1
    Date: 2005–11
  16. By: Patrick Bayer; Robert McMillan
    Abstract: Prompted by widespread concerns about public school quality, a growing empirical literature has measured the effects of greater choice on school performance. This paper contributes to that literature in three ways. First, it makes the observation that the overall effect of greater choice, which has been the focus of prior research, can be decomposed into demand and supply components: knowing the relative sizes of the two is very relevant for policy. Second, using rich data from a large metropolitan area, it provides a direct and intuitive measure of the competition each school faces. This takes the form of a school-specific elasticity that measures the extent to which reductions in school quality would lead to reductions in demand. Third, the paper provides evidence that these elasticity measures are strongly related to school performance: a one-standard deviation increase in the competitiveness of a school's local environment within the Bay Area leads to a 0.15 standard deviation increase in average test scores. This positive correlation is robust and is consistent with strong supply responsiveness on the part of public schools, of relevance to the broader school choice debate.
    JEL: I20 H41 R21
    Date: 2005–11
  17. By: Andres Erosa; Luisa Fuster; Diego Restuccia
    Abstract: An important feature of the U.S. labor market is that, even after controlling for measurable differences in education and experience, the average wage of women with children is 89 percent of the average wage of women without children. This "family gap" in wages accounts for almost half the gender gap in wages. Proponents of mandatory-leave policies argue that career interruptions associated with fertility have long-lasting effects on female employment and are costly in terms of human-capital losses for females. Despite the fact that mandatory leaves are widely applied in developed countries, their effects on the economy are not well understood. We develop and calibrate a general-equilibrium model of fertility and labor-market decisions to study the quantitative impact of such policies. We build on the Mortensen and Pissarides (1994) labor-market framework by introducing male and female workers, general and specific human-capital accumulation on the job, and temporary separations between the worker and a job. We find that: (i) the loss of specific human capital accounts for a small fraction of the wage gaps and (ii) mandatory-leave policies have substantial aggregate and redistributive effects on fertility, employment, and welfare. Interestingly, we find that the general-equilibrium effect of mandatory-leave policies is a reduction in the amount of time females spend at home with children.
    Keywords: Labor market ; Labor economics
    Date: 2005
  18. By: Patrick Puhani (Institut für Volkswirtschaftslehre (Department of Economics), Technische Universität Darmstadt (Darmstadt University of Technology)); Andrea Maria Weber (Institut für Volkswirtschaftslehre (Department of Economics), Technische Universität Darmstadt (Darmstadt University of Technology))
    Abstract: We estimate the effect of age of school entry on educational attainment using three different data sets for Germany, sampling pupils at the end of primary school, in the middle of secondary school and several years after secondary school. Results are obtained based on instrumental variable estimation exploiting the exogenous variation in month of birth. We find robust and significant positive effects on educational attainment for pupils who enter school at seven instead of six years of age: Test scores at the end of primary school increase by about 0.42 standard deviations and years of secondary schooling increase by almost half a year.
    Keywords: education, immigration, policy, identification
    JEL: I21 I28 J24
    Date: 2005–11
  19. By: Böhlmark, Anders (Swedish Institute for Social Research, Stockholm University)
    Abstract: There is a gap in school performance between native and immigrant pupils in Sweden. This article analyzes the role of age at immigration, which is believed to be an important determinant of this gap, since it is inversely related to the time spent acquiring Sweden-specific skills before graduation. The analysis exploits within-family variation in a large set of register data on immigrant siblings (and native children) graduating from compulsory school between 1988 and 2003. The estimated negative impact from short duration of residence prior to graduation is significantly less than the one observed using a standard cross-sectional approach which fails to net out family-fixed effects. The critical age at arrival is about 10. Above this age, there is a strong negative impact on performance, where the sibling-difference estimates are 27-54 percent less negative than the cross-sectional ones. The results show both similarities and striking differences between boys and girls and between children of different origin. Moreover, children with short duration of residence perform significantly better in mathematics than in a range of subjects taken together. This demonstrates the importance of Sweden-specific skills.
    Keywords: age at immigration; age at arrival; school performance; siblings approach
    JEL: I29 J15
    Date: 2005–11–21
  20. By: Han, Seungjin; Bjerk, David
    Abstract: We develop a model of the labor market where firms incur an adjustment cost when one of their workers quits, and males and females form households assortatively by skill. In this environment, we show that females can earn less and drop out more frequently than equally skilled males in equilibrium, even if males and females are ex-ante identical. Moreover, this gender inequality can be exacerbated by several reasonable government provision of homecare service schemes. In fact, we find that gender inequality can only be unambiguously decreased when homecare services are provided to only dual-career households and funded via fixed taxes that do not depend on earnings.
    JEL: H42 H24 J71 J16 J13
    Date: 2005–11–21
  21. By: Andres Erosa; Luisa Fuster; Diego Restuccia
    Abstract: Using panel data from the National Longitudinal Survey of Youth (NLSY), we document that gender differences in wages almost double during the first 20 years of labor market experience and that there are substantial gender differences in employment and hours of work during the life cycle. A large portion of gender differences in labor market attachment can be traced to the impact of children on the labor supply of women. We develop a quantitative life-cycle model of fertility, labor supply, and human capital accumulation decisions. We use this model to assess the role of fertility on gender differences in labor supply and wages over the life cycle. In our model, fertility lowers the lifetime intensity of market activity, reducing the incentives for human capital accumulation and wage growth over the life cycle of females relative to males. We calibrate the model to panel data of men and to fertility and child related labor market histories of women. We find that fertility accounts for most of the gender differences in labor supply and wages during the life cycle documented in the NLSY data.
    Keywords: Labor economics ; Wages
    Date: 2005
  22. By: Marco Francesconi (University of Essex and IZA Bonn); Stephen P. Jenkins (ISER, University of Essex, DIW Berlin and IZA Bonn); Thomas Siedler (ISER, University of Essex, DIW Berlin and IZA Bonn)
    Abstract: We analyze the impact on schooling outcomes of growing up in a family headed by a single mother. Growing up in a non-intact family in Germany is associated with worse outcomes in models that do not control for possible correlations between common unobserved determinants of family structure and educational performance. But once endogeneity is accounted for, whether by using sibling-difference estimators or two types of instrumental variable estimator, the evidence that family structure affects schooling outcomes is much less conclusive. Although almost all the point estimates indicate that non-intactness has an adverse effect on schooling outcomes, confidence intervals are large and span zero.
    Keywords: childhood family structure, lone parenthood, educational success, sibling differences, instrumental variables, treatment effects
    JEL: C23 D13 I21 J12 J13
    Date: 2005–11
  23. By: Alan Manning; Joanna Swaffield
    Abstract: In the UK the gender pay gap on entry to the labour market is approximately zero but afterten years after labour market entry, there is a gender wage gap of almost 25 log points. Thispaper explores the reason for this gender gap in early-career wage growth, considering threemain hypotheses - human capital, job-shopping and 'psychological' theories. Human capitalfactors can explain about 12 log points, job-shopping about 1.5 log points and thepsychological theories about half a log point. But a substantial unexplained gap remains:women who have continuous full-time employment, have had no children and express nodesire to have them earn about 12 log points less than equivalent men after 10 years in thelabour market.
    Keywords: Gender Pay Gap, Wage Growth
    JEL: J24 J31 J7
    Date: 2005–07
  24. By: Richard Belfield; David Marsden
    Abstract: The introduction of performance-related pay and performance management schemes in the maintained, state,school sector represents a considerable change in the school management system. This paper combines theresults of opinion surveys of classroom and head teachers with Department for Education and Skills schoolperformance data to consider the operation and impact of the new system in England since 2000. We find thatteachers' response to the new system closely resembles that of other groups of public service workers to similarschemes. In particular, teachers appear not to be greatly motivated by the financial-incentive element of thesystem. However, the goal-setting and appraisal aspect of the system is steadily establishing itself in schools,and seems to be giving rise to a better alignment of teacher and school objectives and with those of nationallevelpolicy objectives. We present tentative evidence that improvements in goal setting within schools arepositively related to rising pupil academic performance.
    Keywords: Education, teachers, performance related pay, public sector, compensation, industrial relations
    JEL: I2 J33 J45 M52
    Date: 2005–08
  25. By: A Charlwood
    Abstract: Overall, collective bargaining coverage has dropped by around fourteen percentage points. This paperinvestigates the causes and consequences of the decline in collective bargaining in Britain between 1990 and1998. One in three workplaces that practiced collective bargaining in 1990 had abandoned it by 1998 and theincidence and coverage of collective bargaining in newer workplaces was lower than in the workplaces theyreplaced. The abandonment of collective bargaining was not associated with an increase in individualisedpayment mechanisms or with the use of 'high involvement' HRM practices. Workplaces that abandonedbargaining reported less impressive productivity gains than other workplaces. Male wage inequality rose as aresult of the decline of bargaining coverage and of weaker unions where collective bargaining remained. Higherlevels of job creation in workplaces that abandoned collective bargaining balance these negative outcomes.
    Keywords: Collective bargaining, de-collectivisation, wage dispersion
    JEL: J31 J5 M12
    Date: 2005–10
  26. By: Ralf Martin
    Abstract: How much of the observed labour productivity spread is real? This paper proposes a novel frameworkto calculate productivity differences between plants accounting for imperfect competition, variationsin output prices across plants, endogeneity of factor inputs and measurement error in labour inputs.For UK manufacturing as a whole I find that on average 59 percent of the labour productivity spreadis explained by a combination of technical efficiency variations and differences in consumervaluations. Measurement error accounts on average for 9 percent of labour productivity spreads. Thepaper argues that standard TFP calculations lead to a systematic under-estimation of welfare relevantdifferences across businesses.
    Keywords: Productivity Measurement, Imperfect Competition, Productivity Spread
    JEL: C81 D24 L11 L25
    Date: 2005–05
  27. By: Hiroshi Ohashi; Tsuyoshi Nakamura (Department of Economics University of Tokyo)
    Keywords: Learning by Doing; vintage capital; technology adoption; TFP; endogeneity; sample selection
    JEL: D24 L61 O14
    Date: 2005
  28. By: Lars-Erik Borge (Department of Economics, Norwegian University of Science and Technology); Linn Renée Naper, Department of Economics, Norwegian University of Science and Technology (Centre for Economic Research and Department of Economics, Norwegian University of Science and Technology)
    Abstract: The paper performs an efficiency analysis of the lower secondary school sector in Norway. The efficiency potential is calculated to 14 percent based on a DEA analysis with grades in core subjects (adjusted for student characteristics and family background) as outputs. The analysis of the determinants of efficiency indicates that a high level of municipal revenue, a high degree of party fragmentation, and a high share of socialists in the local council are associated with low educational efficiency. The negative effects of the share of socialists and party fragmentation seem to reflect both higher resource use and lower student performance.
    Keywords: educational efficiency; DEA analysis; determinants of efficiency; political and budgetary institutions
    JEL: I21
    Date: 2005–11–17
  29. By: Andréa Zaitune Curi; Naércio Aquino Menezes-Filho
    Abstract: The aim of this paper is to examine the relationship between the school performance and the wages of young Brazilians workers. We examine if school quality, measured by test scores of a generation in SAEB at the end of high school, affect the earnings of this generation when they enter the labor force, six years later. We use a pseudo-panel model to correct the problems of selection bias, created by migrations and by the high education level of the selected sample, through a Roy model (1951) applied in Dahl (2001). The determinants of school performance, like familiar background, school structure, teacher and director profiles also were analyzed. We conclude that in spite of school characteristics being responsible for a good performance of students in tests scores, what explains the differences of the earnings of young Brazilians workers is the school performance not explained by the model.
    JEL: I20
    Date: 2005
  30. By: Carine Milcent; Jack Huguenin; Danielle Carusi-Machado
    Abstract: In Brazil, even though school participation is compulsory for children between 7 to 14 years old, some of them are not enrolled in the education system. One of the main reasons is their participation to the work market that may have an impact on their health. Moreover, child's school attendance in public schools usually insures a meal to child but for children working, they have to accumulate two journeys: school and job. So, child's health could be explained by both, school attendance and work market participation. In addition, problems related to school attendance and school progress could be related to child work or his health. Therefore, we cannot explore determinants of one of these components school attendance, health and child work without studying their interactions. In this paper, we use the database Living Standards Measurement Study Survey 1996/1997 (Pesquisa de Padrões de Vida - PPV) to look at this interactions. It appears that child's labor and school attendance have a very strong correlation. School attendance has a negative impact in child's probability to participate in labor market. For instance, child ´s labor market affects negatively child ´s probability to evaluate his health as good and excellent. We also note that school attendance does not have a significant impact in child ´s health evaluation. The main conclusion of our article is that the development of human capital should consider together health and education. A policy focusing only in education, as incentives to go to school, does not seem to be sufficient to improve child's health. Also, government should also consider the population at risk, as children from poor families, living in worse conditions and obliged to work.
    JEL: I12 J13 J18 J24
    Date: 2005
  31. By: Bruno Giovannetti; Naércio Aquino Menezes-Filho
    Abstract: This paper aims to understand the dynamic of the relative demand for skilled labor in Brazilian industry, during the last decade. Thus, presenting evidences that relative demand for skill increased overall in the period, it seeks to explain this movement, at least in part. For this, we test the hypothesis of skill biased technological changes in an environment of economic opening. The results indicate that a greater share of imported intermediate goods in factories, signaled by the reduction in the tariffs charged on these goods, explains the shift in relative demand for skilled labor, throughout an increasing in the relative productivity between skilled and unskilled workers. This points out to the fact that the hypothesis of skill biased technological changes explains, at least in part, the shift in the relative demand for skilled labor.
    JEL: J23 J31
    Date: 2005
  32. By: Fabiana de Felício; Reynaldo Fernandes
    Abstract: The research on the relation between school quality and student achievement have many different results, but most analysts conclude that the school quality has little influence on student performance, as compared to background characteristics. However, there are evidences that difficulties using school inputs to represent school quality could underestimate the quality-achievement relation. The alternative methods suggested in this study are independent of school inputs. In both methods we have used data about 4th grade of Elementary School in São Paulo State from SAEB 2001. In the first one, a decomposition of standardized test score inequality - in part explained by school differences and another by background characteristics - indicates that school differences can explain something between 0.0 and 28.4% of Portuguese score inequality and between 8.7 and 34.4% of Mathematics score inequality. The second method estimates the school impact on student achievement by fixed effects, including dummy variables for each school. It's possible to obtain the interpretation from the simulations made that as for Portuguese as for Mathematics the means of SAEB scores can be improved in one standard deviation, which means 3 years of schooling when all students are included. This also happens when only students from public schools are included (three years of schooling for mathematics and 2.4 for Portuguese scores). This study indicates that educational policies and investments can improve student achievement by replicating existing experiences in the present educational system.
    JEL: I21 I28 P36
    Date: 2005
  33. By: Joilson Dias; Maria Helena Ambrósio Dias; Fernandina Fernandes de Lima
    Abstract: In this paper, we develop a model that has as main outcome the existence of a non-linear relationship between growth and level of education (human capital). This non- linearity condition accrues from empirical estimation done at international level. Moreover, this non-linearity explains the contradictory results of the role of human capital, since a linear relationship has always been the assumption. The tests indicated that the basic econometric model should be a random effect model; however, this model assumes as a priori hypothesis the causality running from human capital. To solve the matter, we fit a dynamic panel data model for Brazilian States. The dynamic specification eliminates the causality problem and even considers the feed back effect of growth on education. The dynamic estimation found education lagged five periods to cause economic growth in the form of an inverted U relationship. The level of education (human capital) that generates the maximum growth rate lies between 4.5 and 4.7 years. The foremost implication of this result is that States with level of education below this range should have as priority education investment.
    JEL: O47 C51
    Date: 2005
  34. By: Bernardo E. Lins; Joaquim P. Andrade
    Abstract: The paper reviews some relations between economic growth and the level of education attained by the individuals. It is shown that, whenever the consumptiondecisions are affected by a preference for education, a concept described by introducing knowledge in the utility function, the decisions of the consumers are affected when the provision of capital and skills differ. Individual choices are, therefore, affected by pressure mechanisms applied over the decisions of the social planner, and richer people are able to extend their privileges by having preferred access to education.
    JEL: O11 O15
    Date: 2005
  35. By: Almir Bittencourt da Silva; Emerson Luis Lemos Marinho
    Abstract: The aim of this paper is to empirically investigate the impact of human capital on economic growth according to Nelson-Phelps (1966), Lucas (1988) and Romer (1986;1990) approachs. The Lucas approach and shared by neo-classical growth theory, assumes that growth is driven by the accumulation of human capital. It treats human capital like an ordinary input in the production function generating increasing returns of scale.Nelson and Phelps approach relates growth to the stock of human capital which affects a country´s ability to innovate and catch up which more advanced countries. According to Romer, human capital may directly influence productivity by determining the capacity of nations to innovate new technologies suited to domestic production. The analysis is performed on a panel of the 68 countries with differents levels of economic development and it was made separately to groups of countries classified by the World Bank like rich, medium income and poor countries. We use the stochastic production frontier analysis and the Malmqüist Index to separate the effects caused by gains in technological progress (displacement of the frontier) from the effects produced by enhanced efficiency (catching up with the frontier). The results obtained show that human capital factor contribute to the economic growth in differents ways like these ones above- mentioned.
    JEL: O11 O33 O47
    Date: 2005
  36. By: Luciano Nakabashi; Lízia de Figueiredo
    Abstract: The objective of this study is to evaluate the different channels in which human capital affects income level and growth and to use a proxy of human capital variable that incorporates quantitative and qualitative aspects of this factor. The human capital proxy that will be used is years of schooling (h) times HDI (Human Development Index) and h times HDI squared. HDI utilization is to measure countries degree of development. The assumption is that the more developed a country is, the better is its system of human capital formation. The empirical analysis is based in a model that incorporates several channels in which human capital affects the rate of income per worker growth: 1) improving the marginal productivity of labor; 2) through creation of technology; and 3) diffusion of technology. The consideration of several channels in which human capital affects income is due to the complexity of the relationship between these two variables. Therefore, if we consider only some channels we can incur in model specification errors.
    JEL: C82 O11 O33
    Date: 2005
  37. By: Carlos E. da Costa; Lucas Maestri
    Abstract: In the presence of an optimally designed unemployment bene.t system we show that it is optimal for the government to encourage human capital acquisition. The driving force of this result is the complementarity between human capital and labor-market- oriented behavior. If policy includes inter-temporal transfers, the optimal level of investment in human capital is given at the point where, at the margin, expected return to human capital is identical to the risk free rate even though there is no full insurance at the optimum.
    JEL: J65 I28
    Date: 2005

This nep-hrm issue is ©2005 by Fabio Sabatini. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.