nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2006‒05‒27
twelve papers chosen by
Fabio Sabatini
Universita degli Studi di Roma, La Sapienza

  1. Evaluating Human Capital Obsolescence By Grip Andries de
  2. Convergence, Human Capital and International Spillovers. By ERTUR, Cem; KOCH, Wilfried
  3. A Knowledge Economy Paradigm and its Consequences By Soete, Luc
  4. Overqualification: Major or minor mismatch? By Malcolm Brynin; Beate Lichtwardt; Simonetta Longhi
  5. Reinventing education: Self-inquiry as a generator of new variety By Chris Sigaloff; Jan Gerrit Schuurman; Iselien Nabben
  6. Mexico : two decades of the evolution of education and inequality By Lopez-Acevedo, Gladys
  7. Skill Biased Technological Change and Endogenous Benefits: The Dynamics of Unemployment and Wage Inequality By Matthias Weiss; Alfred Garloff
  8. Are New Work Practices and New Technologies Biased against Immigrant Workers? By Michael Rosholm; Marianne Røed; Pål Schøne
  9. Emergent theory and technology in E-learning By Marie-Joëlle Browaeys,; Stephanus Eko Wahyudi
  10. Teacher quality and incentives - Theoretical and empirical effects of standards on teacher quality By Hendrik Jürges; Wolfram F. Richter; Kerstin Schneider
  11. Skill dispersion and firm productivity; an analysis with employer-employee matched data By Susanna Iranzo; Fabiano Schivardi; Elisa Tosetti
  12. Child Work and Schooling Costs in Rural Northern India By Gautam Hazarika; Arjun S. Bedi

  1. By: Grip Andries de (ROA wp)
    Abstract: Human resources are playing a central role in the knowledge economy that emerged in the Western world as the human capital embodied in both high-tech capital goods and the working population is a main determinant of the performance of individuals, organizations and national economies. Human resources stimulate technological change, whereas technological change stimulates the use of human resources. First, human capital is an important input factor in research & development, which is in particular emphasized by endogeneous growth theory (e.g. Romer, 1990). This is called the research effect of human capital (Cörvers, 1999). Second, high-skilled workers are of crucial importance for the diffusion of new technologies in the various sectors of the economy (Bartel & Lichtenberg, 1987). This is the diffusion effect of human capital.
    Keywords: education, training and the labour market;
    Date: 2006
  2. By: ERTUR, Cem (LEG - CNRS UMR 5118 - Université de Bourgogne); KOCH, Wilfried (LEG - CNRS UMR 5118 - Université de Bourgogne)
    Abstract: This paper develops a growth model with physical and human capital externalities to- gether with technological interdependence between economies. It leads to a spatial autore- gressive reduced form for the convergence equation characterized by parameter heterogeneity. A locally linear spatial autoregressive speci¯cation is then estimated providing a di®erent convergence speed estimate for each country in a sample of 89 countries over the period 1960-1995. Finally, counterfactual density estimates show that our model better ¯ts the observed income distribution than the well known augmented neoclassical growth model.
    Keywords: Conditional convergence ; spatial externalities ; spatial autocorrelation ; bayesian estimation ; parameter heterogeneity ; locally linear estimation
    JEL: C14 C21 O41
    Date: 2006–03
  3. By: Soete, Luc (United Nations University, Maastricht Economic and social Research and training centre on Innovation and Technology)
    Abstract: During the 1980s and 1990s "Active labour" market reforms opened up labour markets in Europe, making them more flexible without putting in jeopardy the essence of the social security protection model. Countries that went furthest in such "active labour" market reforms such as the UK, the Scandinavian countries, and the Netherlands witnessed not just reductions in unemployment, but also impressive increases in employment participation rates, particularly among underrepresented groups in the labour market. The challenge today appears more or less similar, but this time with respect to knowledge. Interestingly, it is those EU Member States that have succeeded most in "activating" their labour markets and developing better functioning social welfare models that have performed best in terms of knowledge investments. This suggests, that success in boosting knowledge investment generates the public resources for the development of social welfare models capable of addressing rapid change, and in particular the global changes of the 21st Century.
    Keywords: Knowledge, Human Capital, Investment, Social Welfare, Technological Change, Social Change, Globalisation
    JEL: O31 O38 O15 I38 J61
    Date: 2006
  4. By: Malcolm Brynin (Institute for Social and Economic Research); Beate Lichtwardt (Institute for Social and Economic Research); Simonetta Longhi (Institute for Social and Economic Research)
    Abstract: A large empirical literature suggests that a proportion of employees are over-educated (overqualified) for the jobs that they do. It also estimates the impact of this mismatch on wages. The empirical results suggest that having more education than is needed for a job generates a premium relative to the job but at the same time a penalty relative to the qualification. This mismatch is often explained either by variation in skills or by a slow start to career. Both explanations are compatible with human capital theory. We measure the incidence of overqualification in four European countries: Britain, Italy, Germany and Norway at differing educational levels, to show that overqualification is most common at the lower levels where careers tend to be flatter. The inclusion of a measure of computer skills also seems to make little difference to the relationship between overqualification and wages. However, one issue which is important is the degree of voluntarism that is associated with progression through education. Overqualification is traditionally measured through years of education required for the job and years spent in education, but this can be separated into a part that reflects the achievement of certificates and a part that reflects the passage of time. The latter is strongly influenced by individual motivation which determines final choices and by institutional factors which might either enhance or constrain these. We isolate the number of excess years a person spends in education without reaching the next qualification level in order to use this as an instrument for over-education. Our results suggest that the impact of over-qualification on wages is rather small, and becomes even smaller when the excess years spent in education are used as instrument for over-education. Overqualification can on these results never be interpreted as a labour-market choice which provides some sort of human-capital premium.
    Date: 2006–05
  5. By: Chris Sigaloff; Jan Gerrit Schuurman; Iselien Nabben (Nyenrode Business Universiteit)
    Abstract: In a public school organisation in the Netherlands a number of problems was met, failing internal governance being the most crucial one. In this kind of situation, the demand for change and improvement often leads to the adoption of a blueprint. A blueprint is a model for change, which has been applied elsewhere, and functions as an example for the situation at hand. Sadly enough, maintaining a blueprint of some sort often leads to meagre results and a number of negative side effects. A principal reason for this failure is that the efficacy of the blueprint depends on the control it exerts. However, most of the problems in society and institutions do not have to do with a lack of control, but with the problem that our institutions are not sufficiently capable of dealing with unexpected variation generated by the actors in a changing environment. In this paper we argue that this problem exists because often actors behave as if they were restricted instances of a category (e.g.: manager, teacher, parent). What is needed is an alternative approach. Hence, a construct is introduced, which was later articulated in terms of the myth of the round table. It is argued that the round table bypasses the imposition of a blueprint, by stimulating a process of selfinquiry and actor-configuration.
    Keywords: Change programs, management theory, management development, blueprint, source of authority, actor position, actor configuration, self-inquiry, reinvention, variation generator.
    Date: 2005
  6. By: Lopez-Acevedo, Gladys
    Abstract: Mexico experienced a pronounced increase in the degree of inequality and earnings inequality over the 1980s and mid 1990s. Contrary to the trend in the distribution of total income inequality, there has been an improvement in the distribution of earnings inequality since 1996. This paper shows the following results. First, education has the highest gross contribution in explaining changes in earnings distribution. Second, both changes in the distribution of education and in the relative earnings among educational groups have always been in phase with the alterations in the earnings distribution. Specifically, when the income profile effect related to education became steeper and the inequality of education increased, the earnings distribution worsened (as in the 1988-96 period). Third, changes in the relative earnings among educational groups are always the leading force behind changes in inequality.
    Keywords: Inequality,Labor Markets,Economic Theory & Research,Access & Equity in Basic Education,Poverty Impact Evaluation
    Date: 2006–05–01
  7. By: Matthias Weiss; Alfred Garloff (Mannheim Research Institute for the Economics of Aging (MEA))
    Abstract: In this paper, we study the effect of skill-biased technological change on unemployment when benefits are linked to the evolution of average income and when this is not the case. In the former case, an increase in the productivity of skilled workers and hence their wage leads to an increase in average income and hence in benefits. The increased fallback income, in turn, makes unskilled workers ask for higher wages. As higher wages are not justified by respective productivity increases, unemployment rises. More generally, we show that skill-biased technological change leads to increasing unemployment of the unskilled when benefits are endogenous. The model provides a theoretical explanation for diverging developments in wage inequality and unemployment under different social benefits regimes: Analyzing the social legislation in 14 countries, we find that benefits are linked to the evolution of average income in Continental Europe but not in the U.S. and the UK. Given this institutional difference, our model predicts that skill-biased technological change leads to rising unemployment in Continental Europe and rising wage inequality in the U.S. and the UK.
    JEL: E24 J31 O30
    Date: 2005–09–14
  8. By: Michael Rosholm (University of Aarhus, AKF Copenhagen and IZA Bonn); Marianne Røed (Institute for Social Research, Oslo); Pål Schøne (Institute for Social Research, Oslo)
    Abstract: New technologies and new work practices have been introduced and implemented over a broad range in the production process in most advanced industrialised countries during the last two decades. New work organisation practices like team organisation and job rotation require interpersonal communication to a larger extent compared to the traditional assembly line types of production. In addition to handling the formal language, communication in this respect includes country-specific skills related to understanding social and cultural codes, unwritten rules, implicit communication, norms etc. In this paper we analyse whether these developments - by increasing the importance of communication and informal human capital - have had a negative effect on employment opportunities of immigrants. The results show that firms that use PCs intensively and firms that give their employees broad autonomy employ fewer non-Western immigrants who have not been raised in Norway (i.e. arrived as adults). Furthermore, the negative relationships are especially strong for low-skilled non- Western immigrants. These results may add support to the hypothesis stating that new technologies and (some) new work practices are biased against non-Western immigrant workers, and especially those with low formal skills.
    Keywords: immigrants, employment, new work practices, new technology
    JEL: J61 J71
    Date: 2006–05
  9. By: Marie-Joëlle Browaeys,; Stephanus Eko Wahyudi (Nyenrode Business Universiteit)
    Abstract: E-learning should be approached via a new paradigm, one where instruction and information are involved in a recursive process, an approach which counters the concept of linearity. New ways of thinking about how people learn and new technologies favour the emergence of principles of e-learning that deliver both business and individual opportunities. In this paper we develop a vision of what learning will look like in the future and a clearer idea of technological opportunities for the promotion of new e-learning.
    Keywords: e-learning, learning, knowledge, technology, paradigm, complexity
    Date: 2006
  10. By: Hendrik Jürges; Wolfram F. Richter; Kerstin Schneider (Mannheim Research Institute for the Economics of Aging (MEA))
    Abstract: Applying the theory of yardstick competition to the schooling system, we show that it is optimal to have central tests of student achievement and to engage in benchmarking because it raises the quality of teaching. This is true even if teachers’ pay (defined in monetary terms) is not performance related. If teachers value reputation, and if teaching output is measured so that it becomes comparable, teachers will increase their effort. The theory is tested using the German PISA-E data. Use is made of the fact that central exams exist in some federal states of Germany but not in all. The empirical evidence suggests that central exams have a positive effect on the quality of teaching.
    JEL: I28
    Date: 2005–06–30
  11. By: Susanna Iranzo (University of Sidney); Fabiano Schivardi (Bank of Italy, Economic Research Department); Elisa Tosetti (Cambridge University)
    Abstract: We study the relation between workers’ skill dispersion and firm productivity using a unique dataset of Italian manufacturing firms from the early eighties to the late nineties with individual records on all their workers. Our measure of skill is the individual worker’s effect obtained as a latent variable from a wage equation. Estimates of a generalized CES production function that depends on the skill composition show that a firm’s productivity is positively related to skill dispersion within occupational status groups (production and non-production workers) and negatively related to skill dispersion between these groups. Consistently, the variance decomposition shows that most of the overall skill dispersion is within and not between firms. We find no change over time in the share of each component, in contrast with some evidence from other countries, based on less comprehensive data.
    Keywords: Matched data, Skills, Productivity, Segregation
    JEL: D24 J24 L23
    Date: 2006–02
  12. By: Gautam Hazarika (University of Texas at Brownsville and IZA Bonn); Arjun S. Bedi (Institute of Social Studies, The Hague)
    Abstract: It is widely held that work by children obstructs schooling, so that working children in impoverished families will find it difficult to escape poverty. If children’s school attendance and work were highly substitutable activities, it would be advisable to quell work in the interest of schooling and, if less child work were desirable for its own sake, to boost school attendance so as to reduce child work. Hence, this article examines the effects of schooling costs upon both children’s propensities to work and to attend school in rural northern India in a bid to assess the extent of trade-off between the activities. Analyses of data from Uttar Pradesh and Bihar, two Northern Indian states, reveal a positive relation between child work and schooling costs, a negative relation between school enrollment and schooling costs, and that the decrease in the probability of child work from a decrease in schooling costs is comparable in magnitude to the corresponding increase in the probability of school enrollment, implying children’s work and school attendance are strongly substitutable activities. Thus, unlike recent studies of child work in India’s South Asian neighbors of Bangladesh and Pakistan, this paper uncovers evidence of substantial trade-off between child work and school attendance.
    Keywords: child labor, schooling costs, India
    JEL: J22 O12
    Date: 2006–05

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