A simple economic theory of skill accumulation and schooling decisions

Blankenau, William; Camera, Gabriele

doi:10.1016/j.red.2005.05.002

Cited by 13 publications

(15 citation statements)

References 24 publications

(12 reference statements)

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“…Even abstracting from the possibility to signal the market, several well-known distributions of unobserved quality (i.e., worker ability) generate multiple equilibria, including the normal distribution that accords well with the 'Bell Curve' often used to describe student performance. A recent analysis where workers acquire schooling to both signal skills and enhance their own productivity is Blankenau and Camera (2006), who demonstrate that generally there are multiple stationary equilibrium. 5 Doms, Dunne and Troske (1997) demonstrate that firms within U.S. manufacturing industries differ according to the skill intensity of their production techniques.…”

Section: 3mentioning

confidence: 99%

A simple model of globalization, schooling and skill acquisition

Davidson

Sly

2014

European Economic Review

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. We develop a model of schooling and skill acquisition, highlighting informational asymmetries that distort the incentives to educate. A key feature of our model is that education acts simultaneously as a signaling device and as a method for workers to enhance their productivity. We show that when firms can only imperfectly screen workers, the result is an economy in which too many workers purchase schooling and too few workers devote sufficient effort to their coursework to qualify for the high skill labor pool. We then examine how greater openness to international markets alters the skill mix of the domestic workforce and show that greater openness usually eases one labor market distortion while making the other distortion worse. Globalization impacts educational behavior and labor market outcomes differently as the extent of firms engaged in international markets varies, and affects wage inequality both within and across educational groups. Terms of use: Documents in

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Section: 3mentioning

confidence: 99%

A simple model of globalization, schooling and skill acquisition

Davidson

Sly

2014

European Economic Review

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“…Namely, we assume that abilities are independent and identically distributed random variables across 2 See also Su (2004), Blankenau and Camera (2006). individuals in each generation and over time.…”

Section: Preferences and Hierarchical Educationmentioning

confidence: 99%

Public funding of higher education

Viaene

Zilcha

2013

Journal of Public Economics

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Public Funding of Higher Education AbstractRecent criticism from different sides has expressed the view that, with scarce resources, there is little justification for massive public funding of higher education. Central to the debate is the conjecture that colleges and universities use their resources inefficiently and focus insufficiently on their mission to expand students' human potential. Our aim in this paper is to examine the theoretical premises of this conjecture in a small open economy and uncover the conditions under which public investment in higher education is efficient and desirable. We analyze non-stationary equilibria of an OLG economy, characterized by perfect capital mobility, intergenerational transfers and a hierarchical education system. The government uses income tax revenues to finance basic education and support higher education that generates skilled labor. Given this, the following issues are considered: (a) the impact of education and international markets on t he equilibrium number of low-skilled and skilled workers in each generation; (b) the economic efficiency of public subsidies to higher education in generating skilled human capital; (c) the endogenous support for a government's educational policies found in a political equilibrium.JEL-Code: D910, E250, H520.

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“…2 CHLM argue that the more meaningful distinction is between human capital investment during and after "critical" periods for the acquisition of particular skills. Perhaps the most straightforward example is the critical period for developing IQ.…”

Section: Introductionmentioning

confidence: 99%

“…4 With the duration of K-12 around six times that of pre-primary education, this suggests that on a per capita basis government spending on 1 See also Carneiro and Heckman (2003), Knudsen, Heckman, Cameron, and Shonkoff (2006), and Currie (2001(b)). 2 See, for example, Driskill and Horowitz (2002), Su (2004), Kaganovich (2005), Blankenau (2005), and Restuccia and Urrutia (2004). 3 See Jensen (1980) and the discussions in CHLM and Cunha and Heckman (2007).…”

Section: Introductionmentioning

confidence: 99%

Government education expenditures in early and late childhood

Abington

Blankenau

2013

Journal of Economic Dynamics and Control

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Human capital investment in early childhood can lead to large and persistent gains. Beyond this window of opportunity, human capital accumulation is more costly. Despite compelling evidence in support of this notion, government education spending is allocated disproportionately toward late childhood and young adulthood. We consider the consequences of a reallocation using an overlapping generations model with private and public spending on early and late childhood education. Taking as given the higher returns to early childhood investment, we find that the current allocation may nonetheless be appropriate. When we consider a homogeneous population, this can hold for moderate levels of government spending. With heterogeneity, this can hold for middle income workers. Lower income workers, by contrast, may benefit from a reallocation.JEL Classification: E62, I22, H52, J24

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A simple economic theory of skill accumulation and schooling decisions

Cited by 13 publications

References 24 publications

A simple model of globalization, schooling and skill acquisition

A simple model of globalization, schooling and skill acquisition

Public funding of higher education

Government education expenditures in early and late childhood

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