nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2009‒11‒21
ten papers chosen by
Fabio Sabatini
University of Siena

  1. Human Capital In China By Haizheng Li; Barbara M. Fraumeni; Zhiqiang Liu; Xiaojun Wang
  2. Education's role in China's structural transformation By Soohyung Lee; Benjamin A. Malin
  3. Do colleges and universities increase their region's human capital? By Jaison R. Abel; Richard Deitz
  4. The Gender Pay Gap across Countries: A Human Capital Approach By Solomon W. Polachek; Jun Xiang
  5. Gendering Human Development Indices: Recasting the Gender Development Index and Gender Empowerment Measure of India By Government of India Ministry of Women and Child Development
  6. The role of geographic mobility in reducing education-job mismatches in the Netherlands By Hensen Maud M.; Vries M. Robert de; Cörvers Frank
  7. Education and wage differentials in the Philippines By Luo, Xubei; Terada, Takanobu
  8. A comparative study of returns to education of urban men in Egypt, Iran, and Turkey By Djavad Salehi-Isfahani; Insan Tunali; Ragui Assaad
  9. The Effects of Risk and Shocks on School Progression in Rural Indonesia By Christopher M Gilbert; Francesca Modena
  10. Remittances and the brain drain revisited : the microdata show that more educated migrants remit more By Bollard, Albert; McKenzie, David; Morten, Melanie; Rapoport, Hillel

  1. By: Haizheng Li; Barbara M. Fraumeni; Zhiqiang Liu; Xiaojun Wang
    Abstract: In this paper we estimate China’s human capital stock from 1985 to 2007 based on the Jorgenson-Fraumeni lifetime income approach. An individual’s human capital stock is equal to the discounted present value of all future incomes he or she can generate. In our model, human capital accumulates through formal education as well as on-the-job training. The value of human capital is assumed to be zero upon reaching the mandatory retirement ages. China’s total real human capital increased from 26.98 billion yuan in 1985 (i.e., the base year) to 118.75 billion yuan in 2007, implying an average annual growth rate of 6.78%. The annual growth rate increased from 5.11% during 1985-1994 to 7.86% during 1995-2007. Per capita real human capital increased from 28,044 yuan in 1985 to 106,462 yuan in 2007, implying an average annual growth rate of 6.25%. The annual growth rate also increased from 3.9% during 1985-1994 to 7.5% during 1995-2007. Therefore, although population growth contributed significantly to the total human capital accumulation before 1994, per capita human capital growth was primary driving force after 1995. The substantial increase in educational attainment during 1985-2007 contributed significantly to the growth in total and per capita real human capital.
    JEL: J24
    Date: 2009–11
  2. By: Soohyung Lee; Benjamin A. Malin
    Abstract: We explore education's role in improving the allocation of labor between China's agricultural and nonagricultural sectors and measure the portion of China's recent growth attributable to this channel. Building from micro-level estimates, we find that education's impact on labor reallocation between sectors accounts for about 9 percent of Chinese growth, whereas its impact on within-sector human capital growth explains only 2 percent. Our findings suggest that, when frictions cause large productivity gaps across sectors and returns to education are greater in higher-productivity sectors, education policy may be a useful tool for increasing efficiency.
    Date: 2009
  3. By: Jaison R. Abel; Richard Deitz
    Abstract: We investigate whether the degree production and research and development (R&D) activities of colleges and universities are related to the amount and types of human capital present in the metropolitan areas where the institutions are located. We find that degree production has only a small positive relationship with local stocks of human capital, suggesting that migration plays an important role in the geographic distribution of human capital. Moreover, we show that spillovers from academic R&D activities tilt the structure of local labor markets toward occupations requiring innovation and technical training. These findings demonstrate that colleges and universities raise local human capital levels by increasing both the supply of and demand for skill.
    Keywords: Research and development ; Human capital ; Universities and colleges ; Regional economics ; Labor market
    Date: 2009
  4. By: Solomon W. Polachek; Jun Xiang
    Abstract: The gender wage gap varies across countries. For example, among OECD nations women in Australia, Belgium, Italy and Sweden earn 80% as much as males, whereas in Austria, Canada and Japan women earn about 60%. Current studies examining cross-country differences focus on the impact of labor market institutions such as minimum wage laws and nationwide collective bargaining. However, these studies neglect labor market institutions that affect women’s lifetime work behavior -- a factor crucially important in gender wage gap studies that employ individual data. This paper explicitly concentrates on labor market institutions that are related to female lifetime work that affect the gender wage gap across countries. Using ISSP (International Social Survey Programme), LIS (Luxembourg Income Study) and OECD wage data for 35 countries covering 1970-2002, we show that the gender pay gap is positively associated with the fertility rate (treated exogenously and endogenously with religion as the instrument), positively associated with the husbandwife age gap at first marriage, and positively related to the top marginal tax rate, all factors which negatively affect women’s lifetime labor force participation. In addition, we show that collective bargaining, as found in previous studies, is negatively associated with the gender pay gap.
    Date: 2009
  5. By: Government of India Ministry of Women and Child Development
    Abstract: Gender-related Development Index (GDI) and Gender Empowerment Measure (GEM) developed by UNDP need to be recast to realistically capture the gender gaps in development and empowerment in the Third World. These indices have been developed from a northern perspective, and do not incorporate the perspective of the south. How can we recast GDI and GEM to make them meaningful for India within the limitations of data availability? Can GDI and GEM become effective instruments for building gender equity?
    Keywords: UNDP, gender, development index, empowerment, index, third world, south, data availability, equity, northern, India, Human Development Index (HDI), Purchasing Power Parity (PPP), economic resources, women, men, resources, child development,
    Date: 2009
  6. By: Hensen Maud M.; Vries M. Robert de; Cörvers Frank (ROA rm)
    Abstract: In this article we investigate the relationship between geographic mobility andeducation-job mismatch in the Netherlands. We focus on the role of geographicmobility in reducing the probability of graduates working (i) jobs below theireducation level; (ii) jobs outside their study fi eld; (iii) part-time jobs; (iv) fl exiblejobs; or (v) jobs paid below the wage expected at the beginning of the career. For thispurpose we use data on secondary and higher vocational education graduates in theperiod 1996–2001. We show that graduates who are mobile have higher probabilityof fi nding jobs at the acquired education level than those who are not. Moreover,mobile graduates have higher probability of fi nding full-time or permanent jobs.Th is suggests that mobility is sought to prevent not only having to take a job belowthe acquired education level, but also other education-job mismatches; graduates arespatially fl exible particularly to ensure full-time jobs.
    Keywords: education, training and the labour market;
    Date: 2009
  7. By: Luo, Xubei; Terada, Takanobu
    Abstract: In the Philippines, an important part of income inequality is associated with the wage difference between the less educated and the better educated. The majority of the least educated are employed in low-paid services jobs and the agricultural sector. Tertiary education is to a large extent a prerequisite for high-paid occupations. Using the Labor Force Survey 2003-2007, this paper examines disparities in human capital endowment, returns to education, and the role of education in wage differentials in the Philippines. The empirical results show that returns to education monotonically increase - workers with elementary education, secondary education, and tertiary education earn 10 percent, 40 percent, and 100 percent more than those with no education. The results also show that education is the single most important factor that contributes to wage differentials. At the national level, education accounts for about 30 percent of the difference in wages. It accounts for a higher percentage of the difference for female workers (37 percent) than male workers (24 percent). There are also differences across regions and sectors. As an economy develops, the demand for skills increases. In the Philippines, efforts to improve education to increase the supply of highly educated people are important not only for long-term growth, but also for helping to translate growth into more equal opportunities for the children of the current generation.
    Keywords: Labor Markets,Education For All,Tertiary Education,Labor Policies,Regional Economic Development
    Date: 2009–11–01
  8. By: Djavad Salehi-Isfahani; Insan Tunali; Ragui Assaad
    Abstract: This paper presents a comparative study of private returns to schooling of urban men in Egypt, Iran, and Turkey using similar survey data and a uniform methodology. We employ three surveys for each country that span nearly two decades, from the 1980s to 2006, and, to increase the comparability of the estimates across surveys, we focus on urban men 20-54 years old and in full time wage and salary employment. Our aim is to learn how the monetary signals of rewards that guide individual decisions to invest in education are shaped by the institutions of education and labor markets in these countries. Our estimates generally support the stylized facts of the institutions of education and labor markets in Middle Eastern countries. Their labor markets have been described as dominated by the public sector and therefore relatively inflexible, and their education systems as more focused on secondary and tertiary degrees than teaching practical and productive skills. Returns in all countries are increasing in years of schooling, which is contrary to the Mincer assumption of linear returns but consistent with overemphasis on secondary and tertiary degrees. Low returns to vocational training relative to general upper secondary, which have been observed in many developing countries, are observed in Egypt and Iran, but not Turkey. This pattern of returns across countries seems to correspond to how students are selected into vocational and general upper secondary tracks, which is an important part of the education institutions of these countries, and the fact that Turkey’s economy is more open than the other two. Greater competitiveness in all three countries over time seems to have increased returns to university education and in few cases to vocational education, but not to general high school.
    Keywords: Egypt, Iran, Turkey, returns to education, Mincer equation, labor market institutions, education institutions, labor market flexibility
    Date: 2009
  9. By: Christopher M Gilbert; Francesca Modena
    Abstract: Many empirical and theoretical studies explore the effects of ex-ante risk and ex-post shocks on child education. While scholars share the opinion that shocks reduce investment in education, there is no general agreement over the effects of uncertainty on child schooling. This work uses the Indonesian Family Life Survey to explore the effects of ex-ante risk and ex-post shocks on school progression in rural Indonesia. We develop a model of household school transition decisions from elementary to junior education and from junior to senior school considering different sources of uncertainty related both to parental and adult income, and under the assumption that withdrawal from school is permanent. In this way, temporary interruptions in child schooling have long term impacts on the child human capital. We show that there is no simple answer to the question of how uncertainty affects schooling decisions. Econometric results suggest that uncertainty about parental income for the time the child may be potentially at school increases the probability of attending junior school while uncertainty about expected earnings from education has a negative and significant effect only for senior school attendance. Finally, positive (negative) income shocks increase (decrease) the probability of attending junior school.
    Date: 2009–11–10
  10. By: Bollard, Albert; McKenzie, David; Morten, Melanie; Rapoport, Hillel
    Abstract: Two of the most salient trends surrounding the issue of migration and development over the past two decades are the large rise in remittances, and an increased flow of skilled migration. However, recent literature based on cross-country regressions has claimed that more educated migrants remit less, leading to concerns that further increases in skilled migration will hamper remittance growth. This paper revisits the relationship between education and remitting behavior using microdata from surveys of immigrants in 11 major destination countries. The data show a mixed pattern between education and the likelihood of remitting, and a strong positive relationship between education and the amount remitted conditional on remitting. Combining these intensive and extensive margins gives an overall positive effect of education on the amount remitted. The microdata then allow investigation as to why the more educated remit more. The analysis finds that the higher income earned by migrants, rather than characteristics of their family situations, explains much of the higher remittances.
    Keywords: Population Policies,Remittances,Debt Markets,International Migration,Access&Equity in Basic Education
    Date: 2009–11–01

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