Skip to main content
Article thumbnail
Location of Repository

Local human capital and its impact on local employment chances in Britain

By Ioannis Kaplanis

Abstract

This paper examines how high human capital in a locality is associated with the employment outcomes of individuals. A probit model is used to examine how the employment probability of otherwise similar working age males is associated with changes in the share of degree holders in the local area. Different econometric specifications are employed in order to shed light on the positive effect found and its possible causes. The paper discusses three main accounts, referring to the consumption demand, productivity spillovers and production complementarities. For Britain, it is found that the share of high skill residents in a locality has a strong positive impact on the local employment chances of men with no qualifications. The effect on the local employment chances of the other educational groups is either insignificant or significant negative. These results are consistent with the consumer demand hypothesis that the presence of high educated, high income individuals in a locality boosts the demand for local low skill services. On the other hand, when the share of skilled workers is used, the results hint on possible simultaneous effect of production complementarities and productivity spillovers. However, the analysis points to the existing limitations of successfully isolating the consumption demand and the production function mechanisms and calls for further research

Topics: HD Industries. Land use. Labor
Publisher: Spatial Economics Research Centre (SERC), London School of Economics and Political Science
Year: 2010
OAI identifier: oai:eprints.lse.ac.uk:33503
Provided by: LSE Research Online

Suggested articles

Citations

  1. (2001). Cities and Skills,’ doi
  2. (2004). Globalization and social change. People and places in a divided world, doi
  3. (2000). How Large Are Human Capital Externalities? Evidence from Compulsory Schooling Laws’, doi
  4. (2006). Human Capital and Regional Knowledge Assets: a Simultaneous Equation Model’, Oxford Economic Papers, doi
  5. (2008). Human Capital Externalities and the Urban Wage Premium: Two Literatures and their Interrelations’, IZA Discussion Paper, doi
  6. (2006). Identifying human capital ex ternalities: Theory with applications’,
  7. (2006). Identifying human capital externalities: Theory with applications’, doi
  8. (1991). Increasing re turns and economic geography, doi
  9. (1991). Increasing returns and economic geography, doi
  10. (2005). Inno vation, agglomeration and regional development,
  11. (2005). Innovation, agglomeration and regional development, doi
  12. (2005). Innovation, Knowledge Spillovers and Local Labour Markets’, Papers in Regional Science , doi
  13. (2005). Is Britain Pulling Apart? Area Disparities in Employment, Education and Crime’,
  14. (2007). Lousy a nd Lovely Jobs: The Rising Polarization of Work in doi
  15. (2007). Lousy and Lovely Jobs: The Rising Polarization of Work in doi
  16. (2004). Mic rofoundations of urban agglomeration economies’ doi
  17. (2004). Microfoundations of urban agglomeration economies’ doi
  18. (2002). Neighbourhood effect s on educational achievement’,
  19. (2002). Neighbourhood effects on educational achievement’,
  20. (1988). On the Mechan ics of Economic Development,
  21. (1988). On the Mechanics of Economic Development, doi
  22. (2008). Policies for 'mixed communities': A critical evaluation’, SERC Policy Papers,
  23. (2007). The Geography of Em ployment Polarisation
  24. (2007). The Geography of Employment Polarisation
  25. (2009). Wage effects from chan ges in local human capital in Britain’, SERC Discussion Paper Kaplanis, I.
  26. (2009). Wage effects from changes in local human capital in Britain’, SERC Discussion Paper Kaplanis, I.
  27. (1982). Wages, rents and the quality of life’, doi

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.