nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2007‒09‒02
fourteen papers chosen by
Fabio Sabatini
University of Rome, La Sapienza

  1. Location-Specific Human Capital, Location Choice and Amenity Demand By Douglas J. Krupka
  2. Intergenerational Transmission of Educational Attainment in Germany: The Last Five Decades By Guido Heineck; Regina T. Riphahn
  3. To Segregate or to Integrate: Education Politics and Democracy By David de la Croix; Matthias Doepke
  4. Educational attainment and second births in Romania By Cornelia Muresan
  5. A Study of Academic Entrepreneurs Using Venture Capital Data By Junfu Zhang
  6. The Causal Effect of Studying on Academic Performance By Todd R. Stinebrickner; Ralph Stinebrickner
  7. Effects of Job Entry Restrictions on Economic Integration - Evidence for Recent Ethnic German Immigrants By Jan Brenner
  8. Risk Aversion and Schooling Decisions By Christian Belzil; Marco Leonardi
  10. Re-Examining the Role of Teacher Quality In the Educational Production Function By Cory Koedel; Julian Betts
  11. Modeling Immigrants’ Language Skills By Barry R. Chiswick; Paul W. Miller
  12. Analyzing the Labor Market Activity of Immigrant Families in Germany By Leilanie Basilio; Thomas K. Bauer; Mathias Sinning
  13. Implications of Human Resource Practices and Other Structural Factors on Commitment of Public Medical Professionals in India By Maheshwari Sunil; Bhat Ramesh; Dhiman Amit
  14. Analyzing the Labor Market Activity of Immigrant Families in Germany By Leilanie Basilio; Thomas K. Bauer; Mathias Sinning

  1. By: Douglas J. Krupka (IZA)
    Abstract: The role of amenities in the flow of migrants has been debated for some years. This paper advances an original model of amenities that work through household production instead of directly through the utility function. Area characteristics (amenities) affect household production, causing certain kinds of human capital investments to be rewarded more than others. Area heterogeneity makes such investments location-specific, in that some areas’ characteristics will reward certain kinds of knowledge more than others. This specificity - along with a period of exogenous location (before migration can be carried out) - increases the opportunity costs of moving, diminishes migration flows between dissimilar locations and increases valuation of amenities which were present in the originating area. These theoretical results emphasize people’s sorting across areas and thus differ from the results of the standard model of compensating differentials. Empirical tests of the model’s predictions using NLSY79 data show that childhood investments affect migration flows in the way proposed by the model.
    Keywords: migration, amenities, human capital, location specificity
    JEL: R23 J61
    Date: 2007–08
  2. By: Guido Heineck (University of Erlangen-Nuremberg); Regina T. Riphahn (University of Erlangen-Nuremberg and IZA)
    Abstract: Over the last decades the German education system underwent numerous reforms in order to improve "equality of opportunity", i.e. to guarantee all pupils equal access to higher education. At the same time internationally comparative evidence yields that Germany features particularly low intergenerational mobility with respect to educational attainment. This study investigates the development in intergenerational education mobility in Germany for the birth cohorts 1929 through 1978 and tests whether the impact of parental background on child educational outcomes changed over time. In spite of massive public policy interventions and education reforms our results yield no significant reduction in the role of parental background for child outcomes over the last decades.
    Keywords: education transmission, intergenerational mobility, schooling, human capital transmission
    JEL: I21 I28 J11
    Date: 2007–08
  3. By: David de la Croix (CORE, Catholic University of Louvain); Matthias Doepke (University of California, Los Angeles, CEPR, NBER and IZA)
    Abstract: The governments of nearly all countries are major providers of primary and secondary education to their citizens. In some countries, however, public schools coexist with private schools, while in others the government is the sole provider of education. In this study, we ask why different societies make different choices regarding the mix of private and public schooling. We develop a theory which integrates private education and fertility decisions with voting on public schooling expenditures. In a given political environment, high income inequality leads to more private education, as rich people opt out of the public system. More private education, in turn, results in an improved quality of public education, because public spending can be concentrated on fewer students. Comparing across political systems, we find that concentration of political power can lead to multiple equilibria in the determination of public education spending. The main predictions of the theory are consistent with state-level and micro data from the United States as well as cross-country evidence from the PISA study.
    Keywords: public education, private education, voting, democracy
    JEL: D72 I21 H42 O10
    Date: 2007–08
  4. By: Cornelia Muresan (Max Planck Institute for Demographic Research, Rostock, Germany)
    Abstract: This study investigates the effect of educational attainment and educational enrolment on the risks of second birth in Romania, using data from the Generations and Gender Survey of 2005. Looking at the 1950-2005 period, we found a persistently negative effect of education on second birth, i.e., women with a relatively high level of education have lower risks of birth. Being in education significantly reduces the risk of second birth compared to women with no educational qualification. The risk is not lower, however, when we compare women who are still enrolled in education with individuals who have a high level of education. The strong negative effect of age at first birth observed when we do not control for personality weakens once we control for unobserved heterogeneity. We also show the extent to which changes in the socio-political regime, in family policies, and in the educational system affect the impact of education on second births.
    Keywords: Romania, education of women, fertility
    JEL: J1 Z0
    Date: 2007–08
  5. By: Junfu Zhang (Clark University and IZA)
    Abstract: Academic entrepreneurship has become an increasingly important channel through which universities contribute to economic development. This paper studies academic entrepreneurs using a comprehensive venture capital database. I find that about two-thirds of the academic entrepreneurs locate their businesses in the same state as their universities. National academy membership and number of faculty awards, measures of a university’s research quality, are the most significant variables in explaining the number of academic entrepreneurs from a university. In contrast, the abundance of venture capital near the university has no significant effect on academic entrepreneurship.
    Keywords: academic entrepreneur, university spin-off, venture capital
    JEL: M13
    Date: 2007–08
  6. By: Todd R. Stinebrickner; Ralph Stinebrickner
    Abstract: Despite the large amount of attention that has been paid recently to understanding the determinants of educational outcomes, knowledge of the causal effect of the most fundamental input in the education production function - students' study time and effort - has remained virtually non-existent. In this paper, we examine the causal effect of studying on grade performance using an Instrumental Variable estimator. Our approach takes advantage of a unique natural experiment and is possible because we have collected unique longitudinal data that provides detailed information about all aspects of this experiment. Important for understanding the potential impact of a wide array of education policies, the results suggest that human capital accumulation is far from predetermined at the time of college entrance.
    JEL: I2 J22 J24
    Date: 2007–08
  7. By: Jan Brenner
    Abstract: We analyze the impact of job entry restrictions on the economic integration of recent ethnic German immigrants, using twelve waves of the German Socio-Economic Panel.The German labor market closely ties job accessibility to vocational education which likely hampers the transferability of foreign human capital. To assess this effect, we compare the job mismatch probabilities of ethnic German immigrants and German natives and the employment probability in jobs that vary by the qualifications they require. Our results suggest that ethnic Germans are disadvantaged upon arrival, yet almost completely assimilate to comparable natives considering these two job quality measures. Furthermore, controlling for these factors explains a considerable share of the earnings gap between ethnic and native Germans.
    Keywords: Human capital transferability and investment, job mismatch, skill requirements, immigrants, wage assimilation
    JEL: F22 J61 J62
    Date: 2007–08
  8. By: Christian Belzil (Centre National de la Recherche Scientifique, CIRANO and IZA); Marco Leonardi (University of Milan and IZA)
    Abstract: We develop a non-rational expectation econometric model of sequential schooling decisions. Using unique Italian panel data in which individual differences in attitudes toward risk are measurable (with error), we investigate the effect of risk aversion on the probability of entering higher education. This allows us to characterize the subjective (as opposed to the objective) effect of higher education on marginal risk exposure. Because the measure of risk aversion (the classical Arrow-Pratt degree of absolute risk aversion) is posterior to schooling decisions, it depends on current wealth realizations and we must therefore take into account its endogeneity. We also allow risk aversion to be measured with error. After taking into account both the endogeneity of wealth and measurement error, we find that risk aversion is a key determinant (comparable to parents’ educational background) of the decisions to enter higher education. Precisely, risk aversion acts as a deterrent to higher education investment.
    Keywords: risk aversion, ex-ante risk, schooling, subjective beliefs, dynamic discrete choices
    JEL: J24
    Date: 2007–08
  9. By: Pasquale De Muro; Francesco Burchi
    Abstract: In the world there are approximately 800 million people who live in condition of food insecurity and illiteracy. This paper shows that education is a key to food security for rural populations in developing countries. Attention is drawn to rural areas because they are traditionally more disadvantaged by national educational policies. The theoretical foundation of this research is that being educated improves rural people’s capacity to diversify assets and activities, increase productivity and income, foster resilience and competitiveness, access information on health and sanitation, strengthen social cohesion and participation: these are all essential elements to ensure food security in the long run. The main findings of this research are the following: first, the association between food insecurity and primary education is very high, while it decreases progressively with basic, secondary, and tertiary education. Such a two-way relationship is expressed through graphical tools and correlation coefficients. Second, the econometric model shows that primary education is a crucial element to reduce food insecurity in rural areas, even when compared to other factors such as access to water, health, and sanitation. Concluding from this model, an increase of access to primary education by 100% causes a decrease of food insecurity by approximately 20% or 24% depending on the definition of food insecurity and its measurement. Finally, since in most of developing countries the majority of people live in rural areas, and since it is in these areas that the largest proportion of world poverty and hunger exists, we can conclude that education for rural people is a relevant tool for promoting overall national food security.
    Keywords: Education, Food Security, Human Development, Cross-
    JEL: I2 Q18 O15 C31
    Date: 2007–07
  10. By: Cory Koedel (Department of Economics, University of Missouri-Columbia); Julian Betts
    Abstract: This study uses administrative data linking students and teachers at the classroom level to estimate teacher value-added to student test scores. We find that variation in teacher quality is an important contributor to student achievement more important than has been implied by previous work. This result is attributable, at least in part, to the lack of a ceiling effect in the testing instrument used to measure teacher quality. We also show that teacher qualifications are almost entirely unable to predict value-added. Motivated by this result, we consider whether it is feasible to incorporate value-added into evaluation or merit pay programs.
    Keywords: teacher quality, educational production, teacher value-added, value-added, test-score ceiling effects, teacher evaluation, teacher accountability, elementary school
    JEL: I20 I21 J24
    Date: 2007–08–22
  11. By: Barry R. Chiswick (University of Illinois at Chicago and IZA); Paul W. Miller (University of Western Australia and IZA)
    Abstract: One in nine people between the ages of 18 and 64 in the US, and every second foreign-born person in this age bracket, speaks Spanish at home. And whereas around 80 percent of adult immigrants in the US from non-English speaking countries other than Mexico are proficient in English, only about 50 percent of adult immigrants from Mexico are proficient. The use of a language other than English at home, and proficiency in English, are both analyzed in this paper using economic models and data from the 2000 US Census. The results demonstrate the importance of immigrants’ educational attainment, their age at migration and years spent in the US to their language skills. The immigrants’ mother tongue is also shown to affect their English proficiency; immigrants with a mother tongue more distant from English being less likely to be proficient. Finally, immigrants living in ethnic enclaves have lesser proficiency in English than immigrants who live in predominately English-speaking areas of the US. The results for females are generally very similar to those for males, the findings from an ordered probit approach to estimation are similar to the findings from a binary probit model, and the conclusions drawn from the analyses mirror those in studies based on the 1980 and 1990 US Censuses. Thus, the model of language skills presented appears to be remarkably robust across time and between the genders.
    Keywords: immigrants, language, enclaves, human capital
    JEL: F22 J15 J24 J40
    Date: 2007–08
  12. By: Leilanie Basilio (Ruhr Graduate School in Economics); Thomas K. Bauer (RWI Essen, Ruhr-University Bochum and IZA); Mathias Sinning (RWI Essen and IZA)
    Abstract: This paper analyzes whether immigrant families facing credit constraints adopt a family investment strategy wherein, upon arrival, an immigrant spouse invests in host countryspecific human capital while the other partner works to finance the family's current consumption. Using data for West Germany, we do not find evidence for such a specialization strategy. We further examine the labor supply and wage assimilation of families whose members immigrated together relative to families whose members immigrated sequentially. Our estimates indicate that this differentiation is relevant for the analysis of the labor market activities of migrant households.
    Keywords: international migration, assimilation, family investment hypothesis
    JEL: D10 F22 J22
    Date: 2007–08
  13. By: Maheshwari Sunil; Bhat Ramesh; Dhiman Amit
    Abstract: In this paper we focus on often neglected issue and inadequately studied area of commitment of public sector health professionals and some of the issues surrounding human resources as its determinants. The paper argues that success or failure of new initiatives in health sector critically hinges on the commitment of the staff. This paper is based on the questionnaire study and focused group discussion of 175 doctors working as district medical officers at district level and holding key administrative positions at state level in four states in India. These four Indian states account for nearly 22 per cent of India’s population. The findings provide some important insights that would be useful in drawing future agenda of strengthening health sector and involving all stakeholders in implementation process. The study finds critical linkage between human resource (HR) practices and commitment of doctors working in the government. Specifically, following HR practices are found critical in influencing organizational commitment: transparency in selection/postings, supportive training and capacity strengthening climate, recognition of performance and regular performance feedback. Further, results suggest that certain work environment and structural factors facilitate these practices. Health officials’ roles need to be redefined and given complexity of coordination at various levels, officials need to be allocated higher responsibilities. There is also a need to improve interpersonal relations within departments and coordination among agencies and officials at various levels. It is also observed that the structural rigidities in the system leading to obstruction in information sharing across various levels needs to be addressed to ensure effective healthcare delivery. This study highlights the criticality of administrative and structural issues for reforms of healthcare sector in India. Addressing human resources issues is critical for ensuring commitment from staff in implementing new initiatives or health reform agenda. National Rural Health Mission (NRHM) also identifies the human resources and capacities as an important challenge. Institutions that are critical vehicles to implement the NHRM would remain weak owing to low commitment of people. It would be important to focus on HR issues before any new initiative is proposed and implemented. The departments of health across states need to broaden and deepen the understanding of HR management and planning issues. For this purpose they may need to set-up HR division having appropriate competency and skill-mix to address the issues and work towards making the right changes. The papers discusses that these changes will be required at both strategic and operational levels.
    Date: 2007–08–23
  14. By: Leilanie Basilio; Thomas K. Bauer; Mathias Sinning
    Abstract: This paper analyzes whether immigrant families facing credit constraints adopt a family investment strategy wherein,upon arrival,an immigrant spouse invests in host country-specific human capital while the other partner works to finance the family’s current consumption. Using data for West Germany, we do not find evidence for such a specialization strategy.We further examine the labor supply and wage assimilation of families whose members immigrated together relative to families whose members immigrated sequentially. Our estimates indicate that this differentiation is relevant for the analysis of the labor market activities of migrant households.
    Keywords: International migration, assimilation, family investment hypothesis
    JEL: D10 F22 J22
    Date: 2007–08

This nep-hrm issue is ©2007 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.
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