Working Paper: NBER ID: w24925
Authors: Edward L. Glaeser; Ming Lu
Abstract: This paper provides evidences of heterogeneous human-capital externality using CHIP 2002, 2007 and 2013 data from urban China. After instrumenting city-level education using the number of relocated university departments across cities in the 1950s, one year more city-level education increases individual hourly wage by 22.0 percent, more than twice the OLS estimate. Human-capital externality is found to be greater for all groups of urban residents in the instrumental variable estimation.
Keywords: human capital; externalities; China; economic growth; education
JEL Codes: E02; H23; J0; J24; R11; R19; R39
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| city-level education (I24) | individual hourly wages (J31) |
| omitted variable bias in OLS estimates (C20) | upward bias in city-level education impact on individual hourly wages (J31) |
| area-level education (I24) | wages of less educated workers (J31) |
| area-level education (I24) | wages of differently skilled workers (J31) |
| human capital externalities (J24) | GDP growth in China (O49) |