nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2006‒03‒11
eleven papers chosen by
Fabio Sabatini
Universita degli Studi di Roma, La Sapienza

  1. Education Inequality, Human Capital Inequality and the Kuznets Curve By K.K.Tang; Lim, A. S. K
  2. Human Capital and Interethnic Marriage Decisions By Delia Furtado
  3. Immigration in High-Skill Labor Markets: The Impact of Foreign Students on the Earnings of Doctorates By George J. Borjas
  4. Post-Secondary Education and Increasing Wage Inequality By Thomas Lemieux
  5. Human capital and the internationalization of venture capital firms By S. MANIGART; V. COLLEWAERT; M. WRIGHT; S. PRUTHI; A. LOCKETT; H. BRUINING; U. HOMMEL; H. LANDSTROM
  6. A General Equilibrium Analysis of Parental Leave Policies By Andrés Erosa; Luisa Fuster; Diego Restuccia
  7. A Quantitative Theory of the Gender Gap in Wages By Andrés Erosa; Luisa Fuster; Diego Restuccia
  8. The influence of Orphanhood on Children’s Schooling and Labour: Evidence from Sub Saharan Africa By L.Guarcello; S.Lyon; F.Rosati; C. Valdivia
  9. College Education and Wages in the U.K.: Estimating Conditional Average Structural Functions in Nonadditive Models with Binary Endogenous Variables By Tobias J. Klein
  10. Program Design and Student Outcomes in Graduate Education By Jeffrey Groen; George Jakubson; Ronald G. Ehrenberg; Scott Condie; Albert Yung-Hsu Liu
  11. School-to-Work Transitions in Sub-Saharan Africa: An overview By L.Guarcello; M. Manacorda; F. Rosati; J. Fares; S.Lyon; C. Valdivia

  1. By: K.K.Tang (MRG - School of Economics, The University of Queensland); Lim, A. S. K
    Abstract: This paper develops an improved measure of human capital. Using a Mincer specification of human capital, the improved measure takes into consideration rates of returns to schooling, education quality, and school dropouts. The paper applies the improved measure to evaluate national and global human capital inequality and compares them with education inequality. Human capital Kuznets curves are evident when relative inequality measures are used while education Kuznets curves are found when absolute inequality measures are used. It is also found that while global education inequality has been declining over the past four decades, global human capital inequality remains largely steady.
  2. By: Delia Furtado (University of Connecticut and IZA Bonn)
    Abstract: Despite a longstanding belief that education importantly affects the process of immigrant assimilation, little is known about the relative importance of different mechanisms linking these two processes. This paper explores this issue through an examination of the effects of human capital on one dimension of assimilation, immigrant intermarriage. I argue that there are three primary mechanisms through which human capital affects the probability of intermarriage. First, human capital may make immigrants better able to adapt to the native culture thereby making it easier to share a household with a native. Second, it may raise the likelihood that immigrants leave ethnic enclaves, thereby decreasing the opportunity to meet potential spouses of the same ethnicity. Finally, assortative matching on education in the marriage market suggests that immigrants may be willing to trade similarities in ethnicity for similarities in education when evaluating potential spouses. Using a simple spouse-search model, I first derive an identification strategy for differentiating the cultural adaptability effect from the assortative matching effect, and then I obtain empirical estimates of their relative importance while controlling for the enclave effect. Using U.S. Census data, I find that assortative matching on education is the most important avenue through which human capital affects the probability of intermarriage. Further support for the model is provided by deriving and testing some of its additional implications.
    Keywords: interethnic marriage, human capital, second-generation immigrants
    JEL: J12 I21 J15
    Date: 2006–02
  3. By: George J. Borjas
    Abstract: The rapid growth in the number of foreign students enrolled in American universities has transformed the higher education system, particularly at the graduate level. Many of these newly minted doctorates remain in the United States after receiving their doctoral degrees, so that the foreign student influx can have a significant impact in the labor market for high-skill workers. Using data drawn from the Survey of Earned Doctorates and the Survey of Doctoral Recipients, the study shows that a foreign student influx into a particular doctoral field at a particular time had a significant and adverse effect on the earnings of doctorates in that field who graduated at roughly the same time. A 10 percent immigration-induced increase in the supply of doctorates lowers the wage of competing workers by about 3 to 4 percent. About half of this adverse wage effect can be attributed to the increased prevalence of low-pay postdoctoral appointments in fields that have softer labor market conditions because of large-scale immigration.
    JEL: J23 J61
    Date: 2006–03
  4. By: Thomas Lemieux
    Abstract: The paper presents descriptive evidence from quantile regressions and more "structural" estimates from a human capital model with heterogenous returns to show that most of the increase in wage inequality between 1973 and 2005 is due to a dramatic increase in the return to post-secondary education. The model with heterogenous returns also helps explain why both the relative wages and the within-group dispersion among highly-educated workers have increased in tandem over time. These findings add to the growing evidence that, far from being ubiquitous, changes in wage inequality are increasingly concentrated in the very top end of the wage distribution.
    JEL: J3
    Date: 2006–03
    Abstract: We examine the neglected area of internationalisation by VCs. Using a representative sample of 195 VCs, we show that the decision of a European VC firm to invest internationally is driven by its human resources. Having more VC executives in general and more VC executives with previous international experience in specific, results in a higher probability of investing internationally. In contrast, more VC executives with experience in the VC industry or with an engineering background lead to a higher probability of remaining domestic.
    Date: 2006–01
  6. By: Andrés 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: Parental leaves, fertility, specific human capital, temporary separations.
    JEL: J2 J3
  7. By: Andrés 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: Gender wage gap, employment, experience, fertility, human capital
    JEL: J2 J3
  8. By: L.Guarcello; S.Lyon; F.Rosati; C. Valdivia
    Abstract: This paper explores possible links between orphanhood and two important determinants of child vulnerability - child labour and schooling - using household survey data from 10 Sub Saharan Africa countries. It forms part of a broader, on-going effort to improve policy responses to the orphan crisis and to child vulnerability generally. Marginal effects calculated after a bivariate probit indicate that becoming an orphan makes it generally less likely that a child has the opportunity to attend school and generally more likely that a child is exposed to work. The size and significance of these effects varies considerably across the 10 analysed countries, but in only one - Lesotho - does orphanhood appear to have no significant effect on either work involvement or school attendance. Double orphans appear to be especially vulnerable to schooling loss and work exposure in the analysed countries, underscoring the importance of the distinction between single and double orphans for policy purposes.
    Date: 2004–10
  9. By: Tobias J. Klein (University of Mannheim, Department of Economics)
    Abstract: We propose and implement an estimator for identifiable features of correlated random coefficient models with binary endogenous variables and nonadditive errors in the outcome equation. It is suitable, e.g., for estimation of the average returns to college education when they are heterogeneous across individuals and correlated with the schooling choice. The estimated features are of central interest to economists and are directly linked to the marginal and average treatment effect in policy evaluation. They are identified under assumptions weaker than typical exclusion restrictions used in the context of classical instrumental variables analysis. In our application for the U.K., we relate levels of expected wages to unobserved ability, measured ability, family background, type of secondary school, and the decision whether to attend college.
    Keywords: Returns to college education, correlated random coefficient model, local instrumental variables, local linear regression
    JEL: C14 C31 J31
    Date: 2006–02
  10. By: Jeffrey Groen; George Jakubson; Ronald G. Ehrenberg; Scott Condie; Albert Yung-Hsu Liu
    Abstract: Doctoral programs in the humanities and related social sciences are characterized by high attrition and long times-to-degree. In response to these problems, the Andrew W. Mellon Foundation launched the Graduate Education Initiative (GEI) to improve the quality of graduate programs and in turn reduce attrition and shorten times-to-degree. Over a 10-year period starting in 1991, the Foundation provided a total of over $80 million to 51 departments at 10 major research universities. We estimate the impact of the GEI on attrition rates and times-to-degree using competing risk duration models and student-level data. The data span the start of the GEI and include information for students at a set of control departments. We estimate that the GEI had modest impacts on student outcomes in the expected directions: reducing attrition rates, reducing times-to-degree and increasing completion rates. The impacts of the GEI appear to have been driven in part by reductions in entering cohort size, improvements in financial support and increases in student quality.
    JEL: I2
    Date: 2006–03
  11. By: L.Guarcello; M. Manacorda; F. Rosati; J. Fares; S.Lyon; C. Valdivia
    Abstract: While youth issues are subject of growing attention in the Sub-Saharan Africa (SSA) region, data for indicators relating specifically to youth employment remain scarce in most SSA countries. There is therefore limited empirical basis for formulating policies and programmes promoting youth employment and successful school to work transitions. The study is aimed at beginning to fill this gap by generating and analyzing a set of youth education and employment indicators based on World Bank survey data for a subset of 13 countries in the Sub Saharan Africa region. Study findings highlight the disadvantaged position of young people in the labour force in the region. They face much higher levels of unemployment than their adult counterparts or young people in developed economies, and are much more concentrated in low skill and unstable informal sector work. Youth never attending school emerge as a particular policy concern. Uneducated youth appear to be stuck not only in low income jobs but also face a high risk of unemployment. The study places particular emphasis on measuring the initial transition from school to work for different groups of young people, and on identifying the factors affecting this transition. Results indicate that the average duration of the transition is very long in many SSA countries, suggesting young people in these countries are faced with substantial labour market entry problems upon leaving the school system.
    Date: 2005–11

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