nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2008‒02‒16
twelve papers chosen by
Fabio Sabatini
University of Rome, La Sapienza

  1. Human Capital, Aggregation, and Growth By Growiec, Jakub
  2. Reflections on Australia’s Skilled Migration Policy By Peter E. Robertson
  3. Agency, education and networks : gender and international migration from Albania By Davis, Benjamin; Azzarri, Carlo; Carletto, Calogero; Stecklov, Guy
  4. Longevity and Education: A Macroeconomic Perspective By Francesco Ricci; Marios Zachariadis
  5. The Dynamic Effects of Skilled Labour Targeting in Immigration Programs By Richard G. Harris; Peter E. Robertson
  6. Communication and Learning By Luca Anderlini; Dino Gerardi; Roger Lagunoff
  7. Social interactions and student achievement in a developing country : An instrumental variables approach By Chaudhury, Nazmul; Asadullah, Mohammad Niaz
  8. Grants or Loans? Theoretical Issues Regarding Access and Persistence in Postsecondary Education By Lorne Carmichael; Ross Finnie
  9. Primary Education in India: Prospects of meeting the MDG Target By Sonia Bhalotra; Bernarda Zamora
  10. The Impact of Classroom Peer Groups on Pupil GCSE Results By Adele Atkinson; Simon Burgess; Paul Gregg; Carol Propper; Steven Proud
  11. Peer Effects and Entrepreneurship By Ramana Nanda; Jesper B. Sorensen
  12. Educating Urban Children By Richard J. Murnane

  1. By: Growiec, Jakub
    Abstract: The famous Mincer equation regressing log earnings on years of schooling is derived from a linear human capital accumulation equation at the individual level. Even if the cross-sectional Mincer equation holds at the level of individuals, it does not hold at the macro level of countries because aggregation of human capital has to take into account its vintage structure: human capital is embodied in people of different generations whose lifespan is finite. Finiteness of people’s lives imposes also a limit on the potential of human capital accumulation to drive aggregate economic growth. Aggregate human capital accumulation may however become an engine of growth thanks to human capital externalities (knowledge spillovers). We use these findings to revisit the assumptions of the well-known Uzawa–Lucas growth model from an aggregation perspective.
    Keywords: human capital accumulation; Mincer equation; aggregation; vintage structure; balanced growth
    JEL: I20 J24 O40
    Date: 2007–07–04
  2. By: Peter E. Robertson (School of Economics, The University of New South Wales)
    Abstract: This paper outlines some recent points of debate over the economic impact of skilled migration on Australia. It is argued that the national gains from an increase in skilled immigration are likely to be small but there are significant effects on income distribution. Recent general equilibrium modeling results are used to show that the skill based immigration programme is a blunt instrument for targeting particular skills needs and may have many potential unintended consequences including the “crowding-out” of higher education in Australia.
    Keywords: Migration; Skilled immigration; Human capital; Education
    Date: 2007–07
  3. By: Davis, Benjamin; Azzarri, Carlo; Carletto, Calogero; Stecklov, Guy
    Abstract: This paper examines the causes and dynamics of the shift in the gender composition of migration, and more particularly, in the access of women to migration opportunities and decision making. The context of the analysis is Albania, a natural laboratory for studying migration developments given that out-migration was practically eliminated from the end of World War II to the end of the 1980s. The authors use micro-level data from the Albania 2005 Living Standards Measurement Study including migration histories for family members since migration began. Based on discrete-time hazard models, the analysis shows an impressive expansion of female participation in international migration. Female migration, which is shown to be strongly associated with education, wealth, and social capital, appears responsive to economic incentives and constraints. Yet, using unique data on the dependency of female migration to the household demographic structure as well as the sensitivity of female migration to household-level shocks, the authors show that it is the households themselves that are the decision-making agents behind this economic calculus and there is little to suggest that increased female migration signals the emergence of female agency.
    Keywords: Population Policies,Anthropology,Human Rights,Voluntary and Involuntary Resettlement,Human Migrations & Resettlements
    Date: 2008–02–01
  4. By: Francesco Ricci; Marios Zachariadis
    Abstract: This paper investigates the determinants of longevity at a macroeconomic level, emphasizing the important role played by education. To analyze the determinants of longevity, we build a model where households intentionally invest in health and education, and where education exerts external effects on longevity. Performing an empirical analysis using data across 71 countries, we find that society’s tertiary education attainment rate is important for longevity, in addition to any role that basic education plays for life expectancy at the individual level. This finding uncovers a key externality of education, consistent with the theoretical hypothesis advanced in our macroeconomic model.
    Keywords: Education, life expectancy, health, externalities, absorptive capacity, welfare
    Date: 2008–02
  5. By: Richard G. Harris (Department of Economics, Simon Fraser University); Peter E. Robertson (School of Economics, The University of New South Wales)
    Abstract: We consider the impact of the recent trend in immigration policies towards selecting migrants on the basis of skills. The analysis uses an inter-temporal general equilibrium model with endogenous skill formation. The model is calibrated to a steady state benchmark that represents Australia in 2000-2001. We then consider the impact of the increase in skilled migrants of approximately 20 thousand per year, which corresponds to the increase in flows of migrant Professionals in Australia since 2000. We find that this generates substantial crowding out of the higher Education sector in Australia. Moreover we show that, when this shock is anticipated as a permanent policy change, there is very little net increase in the stock of skilled labour due to falling student enrollments of 12%. Paradoxically, in this case, the decline in students increases the number of unskilled workers in the economy such that the ratio skilled to unskilled workers in the economy actually falls and the skill premium increases.
    Keywords: Immigration; Human Capital; Computable General Equilibrium Models
    Date: 2007–07
  6. By: Luca Anderlini; Dino Gerardi; Roger Lagunoff
    Date: 2008–02–08
  7. By: Chaudhury, Nazmul; Asadullah, Mohammad Niaz
    Abstract: This paper identifies endogenous social effects in mathematics test performance for eighth graders in rural Bangladesh using information on arsenic contamination of water wells at home as an instrument. In other words, the identification relies on variation in test scores among peers owing to exogenous exposure to arsenic contaminated water wells at home. The results suggest that the peer effect is significant, and school selection plays little role in biasing peer effects estimates.
    Keywords: Tertiary Education,Education For All,Teaching and Learning,Primary Education,Secondary Education
    Date: 2008–02–01
  8. By: Lorne Carmichael (Queen's University); Ross Finnie (University of Ottawa)
    Abstract: Most economic investigations of access to education treat an investment in college or university as if it were a financial investment offering a particular expected rate of return. Since the average measured rates of return are quite favourable, other factors such as lack of information, contrary parental infl‡uence, or "debt aversion" must be invoked to explain the unwillingness of some qualified students from poorer backgrounds to borrow money and attend. However, a model that recognizes the hardship associated with low levels of expenditure suggests that, ceteris paribus, poorer students will actually need a higher measured rate of return before they will decide to attend. The result holds even when there is an efficient student loan system. This approach can provide some normative guidance for decisions about the choice of grants or loans as vehicles for student aid, and has positive implications about the effects of grants and loans on access and persistence.
    Keywords: postsecondary education, educational subsidies, student loans, equal access, hyperbolic preferences
    JEL: I20 I22 J24
    Date: 2007–12
  9. By: Sonia Bhalotra; Bernarda Zamora
    Abstract: This paper uses two large repeated cross-sections, one for the early 1990’s, and one for the late 1990’s, to describe growth in school enrolment and completion rates for boys and girls in India, and to explore the extent to which enrolment and completion rates have grown over time. It decomposes this growth into components due to change in the characteristics that determine schooling, and another associated with changes in the responsiveness of schooling to given characteristics. Our results caution against the common practice of using current data to make future projections on the assumption that the model parameters are stable. The analysis nevertheless performs illustrative simulations relevant to the question of whether India will be able to achieve the Millennium Development Goal of realising universal primary education by the year 2015. The simulations suggest that India will achieve universal attendance, but that primary school completion rates will not exhibit much progress.
    Keywords: Millennium Development Goals, primary schooling, attendance, completion rates, gender, India, decomposition
    JEL: I21 I28 O12 J18
    Date: 2008–01
  10. By: Adele Atkinson; Simon Burgess; Paul Gregg; Carol Propper; Steven Proud
    Abstract: The effect of a more able peer group on a child’s attainment is considered an integral part in estimating a pupil level educational production function. Examinations in England at age 16 are tiered according to ability, leading to a large stratification of pupils by ability. However, within tiers, there is a range of policies between schools regarding setting, ranging from credibly random to strict setting by results from examinations at age 14. We use this variation to estimate ordinary least squares (OLS) estimates, with school and teacher fixed effects, of the effect of a more able peer group using a subset of schools that has apparently random allocation of pupils. As a robustness test of the apparently random setting results, we use an instrumental variables (IV) methodology developed by Lefgren (2004b). We find significant, positive, and non-trivial effects of a more able peer group using both the OLS and IV estimations for English and mathematics.
    Keywords: peer groups, education
    JEL: J13 D1 I21 I38
    Date: 2008–01
  11. By: Ramana Nanda (Harvard Business School, Entrepreneurial Management Unit); Jesper B. Sorensen (Graduate School of Business, Stanford University)
    Abstract: We examine whether the likelihood of entrepreneurial activity depends on the prior career experiences of an individual's co-workers. We argue that peers may increase an individual's likelihood of becoming an entrepreneur through two channels: by increasing the likelihood that an individual will perceive entrepreneurial opportunities, and by increasing his or her willingness to pursue those opportunities. Our analysis uses a unique panel dataset that allows us to track the career histories of individuals across firms. We find that an individual is more likely to become an entrepreneur if his or her co-workers have been entrepreneurs before, or if the co-workers' careers involved frequent movement between firms. Peer influences appear to be substitutes for direct experience: the effects are strongest for those without exposure to entrepreneurship in their family of origin, and for those who have engaged in little inter-firm mobility themselves. These effects are robust to attempts to address concerns about unobserved heterogeneity bias.
    Date: 2006–03
  12. By: Richard J. Murnane
    Abstract: For a variety of reasons described in the paper, improving the performance of urban school districts is more difficult today than it was several decades ago. Yet economic and social changes make performance improvement especially important today. Two quite different bodies of research provide ideas for improving the performance of urban school districts. One group of studies, conducted primarily by scholars of organizational design, examines the effectiveness of particular district management strategies. The second, conducted primarily by economists, focuses on the need to improve incentives. Each body of research offers important insights. Each is somewhat insensitive to the importance of the insights offered by the other literature. A theme of this paper is that insights from both literatures are critical to improving urban school systems.
    JEL: I2
    Date: 2008–02

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