nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2007‒06‒30
eight papers chosen by
Fabio Sabatini
University of Rome, La Sapienza

  1. Specialization in Higher Education and Economic Growth By von Greiff, Camilo
  2. From creativity to innovation By Yusuf, Shahid
  3. Linking Technical Education to Business Growth: A Case Study on Building Technical Skills in India By Basant Rakesh; Chandra Pankaj
  4. Political Regimes and Economic Growth in Latin America By Facundo Albornoz; Jayasri Dutta
  5. Making their mark. Disentangling the Effects of Neighbourhood and School Environments on Educational Achievement By Brännström, Lars
  6. Apprenticeship Training in Germany – Investment or Productivity Driven? By Thomas Zwick
  7. Why Is Poverty So High Among Afro-Brazilians? A Decomposition Analysis of the Racial Poverty Gap By Carlos Gradín
  8. Measuring a Society’s Knowledge Base By Khumalo, Bhekuzulu

  1. By: von Greiff, Camilo (Dept. of Economics, Stockholm University)
    Abstract: This paper presents a new market failure in the decision on educational type in higher education. Individuals choose types of education with different degrees of specialization. Labor market transformation makes some individuals opt for a non-specialized education type that broadens the future career possibilities in an uncertain labor market. However, the growth rate in the economy is assumed to positively depend on the amount of specialized workers that get a job within their specialized field. Imposing a tax and transfer scheme in favor of specialized education types may correct for the market failure and Pareto improve the economy if the transfer attracts a sufficiently large amount of new students to a specialized education type and if their effect on the growth rate is substantial.
    Keywords: Educational Choice; Growth
    JEL: H23 I22
    Date: 2007–06–27
  2. By: Yusuf, Shahid
    Abstract: Talent is the bedrock of a creative society. Augmenting talent involves mobilizing culture and tradition, building institutions to increase the stock of human capital, enhance its quality, and instill values favoring achievements and initiative. The productivity of this talent in the form of ideas can be raised by nurturing wikicapital-the capital arising from networks. Translating creativity into innovation is a function of multiple incentives and sustaining innovation is inseparable from heavy investment in research. Finally, the transition from innovation to commercially viable products requires the midwifery of many service providers and the entrepreneurship skills of firms small and large.
    Keywords: Education for Development (superceded),ICT Policy and Strategies,Tertiary Education,Agricultural Knowledge & Information Systems,Cultural Policy
    Date: 2007–06–01
  3. By: Basant Rakesh; Chandra Pankaj
    Abstract: Education has been recognized as the most important source of competitive advantage for a nation. It is the key determinant of firm level productivity which in turn drives business growth and profitability. Technical knowledge, in particular, is required both for industrial as well as service development. Technical institutions contribute to the growth of business and industry in a variety of ways. The most influential and direct impact is through their graduates who bring in new skills and perspectives to firms. Industries also seek advanced training on specific topics as well as consultancy from technical institutions. Often these institutions collaborate with academics to design and develop new technologies. In this paper we have argued that technical education plays a crucial role in building these capabilities and consequently in the growth of industry. We use the case study of the Indian technical education system to explore the nature of this system, mechanisms used to govern it, linkages between the education regime and the industry, and the roles that different stakeholders play in ensuring that such a regime delivers sustained advantage to the society. We study the business growth in a few select sectors and the changing needs of technical skills therein. These sectors are agricultural implements, auto-components, chemicals, construction, garments and machine tools. We also illustrate the link between technological innovation and technical skills thereby pointing towards the trajectory of developing industrial competitiveness.
    Date: 2007–03–30
  4. By: Facundo Albornoz; Jayasri Dutta
    Abstract: Living in a democratic society has been internationally recognized as a basic human right. While most of the literature tries to identify the effect of democracy on economic prosperity, little work has been done to understand the determinants of economic growth under democracy. This paper examines whether the determinants of economic growth in Latin America are sensitive to political institutions. We find two stark differences between democratic and autocratic growth: (1) democratic government consumption is significantly positive for economic growth. The opposite is true for autocratic government consumption. (2) The impact of human capital is only significant under democracies.
    Keywords: Economic Growth, Latin America, Democracy, Autocracy, Government Consumption, human capital
    JEL: H50 P16 N46
    Date: 2007–06
  5. By: Brännström, Lars (Institute for Futures Studies)
    Abstract: One subject that has received ample attention in recent years is the potential negative effects of spatial concentrations of disadvantage on participation in society, particularly in terms of labour market participation and educational careers. This study contributes to the literature on the effects of neighbourhood and school on individual educational outcomes by examining whether and to what extent adolescent educational achievement is determined by neighbourhood and school population characteristics. By using an unusually rich administrative data set of leaving certificates for around 26,000 upper secondary school students who were registered as residing in any of the three metropolitan areas of Sweden in the school year 2004, cross-classified multilevel analyses show that characteristics attributable to upper secondary schools matter much more for the variability in achievement than do neighbourhoods. There are also indications of contextual effects at each level (particularly among boys with an immigrant background) that operate above and beyond the impact of observed individual-level background attributes. Since the estimated effects of concentrations of (dis)advantage and immigrant density at neighbourhood and school level point in different directions, this study demonstrates the benefits of analysing the effects of neighbourhood and school on individual educational outcomes at the same time.
    Keywords: education; neighbourhood
    JEL: I20 J31
    Date: 2007–06–25
  6. By: Thomas Zwick
    Abstract: The German dual apprenticeship system came under pressure in recent years because enterprises were not willing to offer a sufficient number of apprenticeship positions. A frequently made argument is that the gap could be closed if more firms would be willing to incur net costs during the training period. This paper investigates for the first time whether German enterprises on average indeed incur net costs during the apprenticeship period, i.e. if the impact of an increase in the share of apprentices on contemporary profits is negative. The paper uses the representative linked employer-employee panel data of the IAB (LIAB) and takes into account possible endogeneity of training intensity and unobserved heterogeneity in the profit estimation by employing panel system GMM methods. An increase in the share of apprentices has no effect on profits. This can be interpreted as a first indication that most establishments in Germany do not invest more in apprentices than their productivity effects during the apprenticeship period.
    Date: 2007
  7. By: Carlos Gradín (Universidade de Vigo and IZA)
    Abstract: This study aimed to identify the major factors underlying the large discrepancy in poverty levels between two Brazilian racial groups: whites and Afro-Brazilians. We performed an Oaxaca-Blinder-type decomposition for nonlinear regressions in order to quantify the extent to which differences in observed geographic, sociodemographic, and labor characteristics (characteristics effect) account for this difference. The remaining unexplained part (coefficients effect) provides evidence on how these characteristics differentially impact on the risk of poverty in each group. A detailed decomposition of both effects allows the individual contribution of each characteristic to be determined. Our results show that the characteristics effect explains a large part of the discrepancy in poverty levels, with education and labor variables of household members explaining at least one half of the effect, and geographic and demographic variables accounting for the remainder. However, the unexplained part that remains significant has increased in importance in recent last years, and probably results from unequal access to high-quality education and the persistence of discrimination against colored workers in the labor market.
    Keywords: poverty, gap, race, skin color, decomposition, Oaxaca-Blinder, Brazil, PNAD, labor market, participation, education, household characteristics
    JEL: D31 D63 J15 J82 O15
    Date: 2007–05
  8. By: Khumalo, Bhekuzulu
    Abstract: The quest to measure knowledge effectively will in no doubt lead to better knowledge policies of governments around the world in both developing and developed countries. This paper endeavours to seta sound theoretical base for measuring knowledge and does this by demonstrating that existing tools used by economists for measuring knowledge are largely self contradictory, they contradict existing theory. Knowledge to be measured effectively we must give knowledge its own units like weight and length have their own units, only then can we say how much knowledge one needs to carry out a particular task.
    Keywords: knowl; knowledge
    JEL: B41 O2 A1
    Date: 2006–10–09

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