nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2007‒02‒24
fourteen papers chosen by
Fabio Sabatini
University of Rome, La Sapienza

  1. The Role of Education in Development By Marla, Ripoll; Juan, Cordoba
  2. Human Capital and Labor Supply: A Synthesis By Alan S. Blinder; Yoram Weiss
  3. Human Capital and Labor Market Employment By Farrell E. Bloch; Sharon P. Smith
  4. On Dogmatism in Human Capital Theory By Alan S. Blinder
  5. Enhancing the Public Provision of Education: The Economics of Education Reform in Developing Countries By Rossana Patrón
  6. Education, Unemployment and Earnings By Orley Ashenfelter; John Ham
  7. Trade, Education and Skills: A Theoretical Survey By Rossana Patrón
  8. Why Are Youth from Lower-income Families Less Likely to Attend University? Evidence from Academic Abilities, Parental Influences, and Financial Constraints By Frenette, Marc
  9. Race and School Quality Since Brown vs. Board of Education. By Michael A. Boozer; Alan B. Krueger; Shari Wolkon
  11. Graduate Unemployment in the Context of Skills Shortages, Education and Training: Findings from a Firm Survey By Kalie Pauw; Haroon Bhorat; Sumayya Goga; Liberty Ncube; Morné Oosthuizen; Carlene van der Westhuizen
  12. Career Progression and Formal versus On-the-Job Training By Adda, Jerome; Dustmann, Christian; Meghir, Costas; Robin, Jean-Marc
  13. The level and growth effects in the empirics of economic growth By Rao, B. Bhaskara; Gounder, Rukmini
  14. Structural breaks in labor productivity growth: the United States vs. the European Union By Juan F. Jimeno; Esther Moral; Lorena Saiz

  1. By: Marla, Ripoll; Juan, Cordoba
    Abstract: Most education around the globe is public. Moreover, investment rates in education as well as schooling attainments differ substantially across countries. We construct a general equilibrium life-cycle model that is consistent with these facts. We provide simple analytical solutions for the optimal educational choices, which may entail pure public provision of education, and their general equilibrium effects. We calibrate the model to fit cross-country evidence on demographics and educational variables. The model is able to replicate a number of key regularities in the data beyond the matching targets. We use the model to identify and quantify sources of world income differences, and find that demographic factors, in particular mortality rates, explain most of the differences. We also use the model to the role of public education and the HIV/AIDS pandemic in development.
    Keywords: education; human capital; development; public education; income differences
    JEL: I22 J24 O11
    Date: 2006–09
  2. By: Alan S. Blinder; Yoram Weiss
  3. By: Farrell E. Bloch; Sharon P. Smith
  4. By: Alan S. Blinder
  5. By: Rossana Patrón (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: The paper argues that a comprehensive evaluation of education reform in particular in developing countries needs considering the triangle’ quality-quantity-equity of educational policies in the short, medium and long term in a broader context than the education system itself. There is no simple “recipe” for improving quality and internal and external efficiency in the public education system but some general results are found. Firstly, that the elasticity of the return of the reform is decreasing with the size of increased budget, making anti-economical the reliance on a reform consisting in more resources only to significantly improve the poor performance of the system. Indeed, very modest target set to improve the system performance, would require -without more sophisticated policies- huge increments in budget with a poor return. In this sense the paper investigate the capacity of focused policies to improve the productivity of the education expenditure, in particular toward basic education or the disadvantaged students. Secondly, the timing of the reform matters: most policies with very different return in the long term are almost undistinguishable by their short run merits, and policies that are more productive in the short term may be less convenient than competing alternatives in the longer term, so the actual policy may be influenced by the time horizon chosen by the policy makers. Thirdly, effects of the reform are accumulative, and to evaluate the reform by modest, in general, short run merits is myopic and may put the reform at risk of reversion or to deter future investment in the sector.
    Keywords: public education, developing countries, development of human resources
    JEL: I28 O15
    Date: 2006–10
  6. By: Orley Ashenfelter; John Ham
  7. By: Rossana Patrón (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)
    Abstract: This paper reviews the literature that relates trade, education and skills formation,intending to provide a theoretical background to policy discussions in education matters. The paper is organised as follows. Section 1 summarises the literature on education and human capital in trade models. Section 2 focuses on education as an investment and the process of human capital accumulation. Section 3 deals with the returns to education. Section 4 analyses the economic literature on the education production function and on issues of effectiveness, efficiency and quality. Section 5 discusses the public provision of education. Section 6 presents some concluding remarks.
    Keywords: public education, economics of education, trade
    JEL: I21 I28 F16
    Date: 2006–10
  8. By: Frenette, Marc
    Abstract: In this study, I use new Canadian data containing detailed information on academic abilities, parental influences, financial constraints, and other socio-economic background characteristics of youth to try to account for the large gap in university attendance across the income distribution. I find that 96% of the total gap in university attendance between youth from the top and bottom income quartiles can be accounted for by differences in observable characteristics. Differences in long-term factors such as standardized test scores in reading obtained at age 15, school marks reported at age 15, parental influences, and high-school quality account for 84% of the gap. In contrast, only 12% of the gap is related to financial constraints. Similar results hold across different income quartiles and when I use standardized test scores in mathematics and science. However, reading scores account for a larger proportion of the gap than other test scores.
    Keywords: Education, training and learning, Children and youth, Educational attainment, Education finance, Low income families, Literacy
    Date: 2007–02–08
  9. By: Michael A. Boozer; Alan B. Krueger; Shari Wolkon
  10. By: Valeria Costantini; Salvatore Monni
    Abstract: (1) All citizens have equal social dignity and are equal before the law, without distinction of sex, race, language, religion, political opinion, personal and social conditions. (2) It is the duty of the Republic to remove those obstacles of an economic or social nature which constrain the freedom and equality of citizens, thereby impeding the full development of the human person and the effective participation of all workers in the political, economic and social organisation of the country.* Sixty years after the first political election in which women voted in Italy (1946), and considering that the Article 3 of the Italian Constitution reminds the role of the republic to promote formal (art. 3.1) and substantial (art. 3.2) equality of Italian citizens, the aim of this paper is to analyse, which is situation of the gender disparities in Italy and how such disparities are distributed among Italian regions. In order to quantify such disparities a comprehensive framework for assessment is required. First, we will compare at national and regional level traditional indicators as income per capita, employment and educational level. Secondly, adopting a human development perspective, we will build some regional Gender Human Development indices with the aim to catch the disparities in terms of capabilities for men and women. Finally to better understand our results, we will build an index of empowerment using data concerning number of seats in national parliament and regional assemblies, in order to catch such existing disparities from a different point of view. In our opinion, the gender disparities in the empowerment dimension and the gender disparities in the other social dimensions are mutually reinforcing, where lack of equally distributed political power corresponds to less gender-related policy actions, and therefore wider disparities in daily life.
    Keywords: Gender disparities, Human Development, Empowerment
    JEL: I3 J16 J21 O15 R1
    Date: 2006–12
  11. By: Kalie Pauw; Haroon Bhorat; Sumayya Goga; Liberty Ncube; Morné Oosthuizen; Carlene van der Westhuizen (Development Policy Research Unit,University of Cape Town)
    Abstract: Abstract: The paper reflects on the findings from a firm survey conducted among twenty of South Africa’s largest firms across a range of sectors. The survey formed part of research conducted by the Development Policy Research Unit on graduate unemployment in South Africa. The firm interviews traversed a range of issues relating, for example, to the schooling and higher education system, the learnership programme and National Skills Development Strategy (NSDS) and the nature of skills shortages and the skills deficit. In turn, a number of detailed long- and short-run policy suggestions emanated from the interviews and background research. In the context of skills shortages the persistence of unemployment among graduates is puzzling. However, the findings here suggest that reported skills shortages, especially in occupations such engineers, technicians and scientists, are most severe at the middle- to senior management level. Graduates do not compete for these positions; in fact, firms generally agree that there are enough graduates available in the economy. Firms do feel,however, that graduates often do not possess the necessary skills and experience to be considered even for entry-level positions. Poor education therefore lies at the heart of the graduate unemployment problem. While on-the-job training in the form of learnerships, implemented in accordance with the NSDS can potentially bridge the skills deficit of graduates, the survey findings rather suggest that this subsidised employment and training programme has not generated above-equilibrium employment in firms. While short-term interventions may help alleviate immediate skills shortages in the economy,it is clear from this research that a longer-term agenda of radically improving education and training in South Africa is the only sustainable solution to skills shortages and, eventually, the graduate unemployment problem.
    Keywords: graduate unemployment, skills shortages
    JEL: A1
    Date: 2006–11
  12. By: Adda, Jerome; Dustmann, Christian; Meghir, Costas; Robin, Jean-Marc
    Abstract: We develop a dynamic discrete choice model of training choice, employment and wage growth, allowing for job mobility, in a world where wages depend on firm-worker matches, as well as experience and tenure and jobs take time to locate. We estimate this model on a large administrative panel data set which traces labour market transitions, mobility across firms and wages from the end of statutory schooling. We use the model to evaluate the life-cycle return to apprenticeship training and find that on average the costs outweigh the benefits; however for those who choose to train the returns are positive. We then use our model to consider the long-term lifecycle effects of two reforms: One is the introduction of an Earned Income Tax Credit in Germany, and the other is a reform to Unemployment Insurance. In both reforms we find very significant impacts of the policy on training choices and on the value of realised matches, demonstrating the importance of considering such longer term implications.
    Keywords: administrative data; apprenticeship; dynamic discrete choice; education; job mobility; job search; labour supply; matching; tax credits
    JEL: I2 J6
    Date: 2007–02
  13. By: Rao, B. Bhaskara; Gounder, Rukmini
    Abstract: Mankiw, Romer and Weil (1992) have extended the Solow (1956) model by augmenting the production function with human capital. Its empirical success is impressive and it showed a procedure to improve the explanatory power of the neoclassical growth model. This paper suggests an empirical procedure to further extend the neoclassical growth model to distinguish between the growth and level effects of shift variables like the human capital. We use time series data from Guatemala to show that while the growth effects of education are small, they are significant and dominate the level effects.
    Keywords: Solow Growth Model; Production Function; Shift Variables; Human Capital Level and Growth Effects
    JEL: O15 O30 O47 O54
    Date: 2007–02–20
  14. By: Juan F. Jimeno (Banco de España; Centre for Economic Policy Research (CEPR); Institute for the Study of Labor (IZA)); Esther Moral (Banco de España); Lorena Saiz (Banco de España)
    Abstract: There is a stark contrast between the recent evolution of labor productivity (and TFP) in the US and EU countries. In the US it accelerated around the mid-1990s and there is evidence of reversion to a high-growth regime. In some EU countries, while employment-population ratios started to rise after a period of stagnant employment, labor productivity (and TFP) decelerated. In this paper we apply univariate and multivariate methods, that have been used to detect structural breaks in productivity growth in the US economy, to EU data to confirm the existence of a significant permanent shift to lower productivity growth in some European countries around the mid-1990s. We find a structural break in mean labour productivity growth in the US around the mid-1990s (towards higher growth), in Continental Europe around the early 1990s (towards lower growth) and no evidence of structural breaks in the UK.
    Keywords: structural breaks, labor productivity, markov switching models
    JEL: C22 O47
    Date: 2006–10

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