Immigration and ‘Brain Waste’: an analysis of APEC immigrants in New Zealand

We analyse ‘brain waste’, or underutilisation of immigrant skills in the New Zealand labour market, with specific reference to immigrants from APEC member countries. Using census data, we find wide variation across APEC countries in the likelihood that a typical immigrant from these countries with a tertiary qualification works in a skilled occupation, consistent with brain waste. Our exploration of the drivers of brain waste reveals that GDP per capita of the country of origin of immigrants, its distance from New Zealand, expenditure on education and colonial links to New Zealand are negatively related to brain waste. After accounting for these drivers, there is no evidence that brain waste is mitigated among immigrants from APEC member countries. Our study highlights the need for efforts to facilitate utilisation of immigrant skills in the region, such as cooperation among APEC members in standardising certification requirements and dissemination of information on skills demand and supply and the nature and quality of the education system

Higher education institutions and regional growth: The case of New Zealand

We examine the relationship between the presence of Higher Education Institutions (HEIs) and local growth, using a sample of 57 New Zealand Territorial Local Authorities (TLAs) between 1986 and 2013. Our models include a large set of controls, including past growth. An innovation of our approach is that we include official population projections as a control to account for growth-related factors that were perceived at the time by policy makers, but are otherwise unobservable to the econometrician. Holding all else equal, we find that a greater university share of Equivalent Full Time Students (EFTS) to working-age population raises population and employment growth. At the means, a one percentage point increase in university EFTS share is associated with a 0.19 (0.14) percentage point increase in the annual average population (employment) growth rate. This relationship holds under all alternative specifications, including different HEI activity definitions, samples, and specifications. On the other hand, growth related to polytechnic activity was estimated less precisely, and is much smaller. While our results suggest a positive association between university activity and growth, we find no evidence for complementarities between HEI activity and several indicators of urbanisation and innovation, nor do we find evidence that HEI presence affected the industrial (sectoral) structure of the local economy

Is internet on the right track? The digital divide, path dependence, and the rollout of New Zealand’s ultra-fast broadband

data on internet access for New Zealand’s 46,637 meshblocks, we examine issues of path dependence and the digital divide. We test whether areas that had the best railway access in the 1880s also have best access to new fibre internet infrastructure. Results suggest strong path dependence with respect to topography: people in areas that lacked 19th century rail due to remoteness or terrain are much less likely to have prioritised fibre access and slightly less likely to have current or (planned) future fibre access. Next, we examine path dependence with respect to ethnicity, given that 19th century railways deliberately avoided predominantly Māori areas. The results suggest weak path dependence: countrywide, Māori are slightly less likely to get fibre access than other New Zealanders, though are slightly more likely to have access within urban areas. Finally, we examine whether the rollout of fibre is increasing or decreasing the digital divide in access between rich and poor. Results show that those in more deprived areas are the most likely to benefit from fibre access, because these areas also tend to be denser and density was a factor in determining the path of the fibre rollout

How did removing student allowances for postgraduate study affect students’ choices?

From 1 January 2013, students in New Zealand who entered postgraduate qualifications other than Honours were no longer eligible to receive student allowances. We use individual-level administrative data that includes tertiary enrolment information, student allowance receipt, student loan borrowing, and wage earnings to investigate whether the policy affected students’ choices. We use a student’s allowance receipt as an undergraduate or her borrowing for course fees as a postgraduate to proxy for her counterfactual allowance eligibility. We use this proxy to compare allowance-eligible and allowance-ineligible students who enter an affected postgraduate qualification or an unaffected Honours degree. Although we are not able to cleanly estimate the causal effect of the policy, our results do not suggest that the policy affected the number or type of postgraduate entrants, their choice between part-time and full-time study, the amount of paid work they performed while studying, or their rates of dropping out. However, our results strongly suggest that students who became ineligible for allowances increased their student loan borrowing for living expenses

Agricultural p roductivity in New Zealand: First e stimat es from the Longitudinal Business Database

Exports of dairy and sheep/beef products account for over 40% of New Zealand's aggregate merchandise exports. As a consequence, the performance of farms in these industries has a significant impact on the New Zealand economy. In this study, we link financial and agricultural data from the New Zealand Longitudinal Business Database (LBD) to estimate production functions of dairy and sheep/beef firms in New Zealand. Overall, we find that the data enables us to explain much of the industry-level variation in productivity and output, offering greater flexibility and insight than simply examining the official (aggregated) statistics. We find that variation in output can be largely explained by variation in capital, labour, intermediate expenditure, and productive land. We also find differences across industries in the way various farm practices (e.g. stocking rates, fertilizer use, supplementary activities, etc.) and area characteristics (including weather) relate to output. Finally, we find that estimating firm productivity at the industry level is less likely to accurately model the relationships for some sub-groups of firms (e.g. firms with different land size). We believe that our methodology could be useful for future studies addressing research questions relevant to this sector

Agricultural productivity in New Zealand: First estimates from the Longitudinal Business Database

Exports of dairy and sheep/beef products account for over 40% of New Zealand's aggregate merchandise exports. As a consequence, the performance of farms in these industries has a significant impact on the New Zealand economy. In this study, we link financial and agricultural data from the New Zealand Longitudinal Business Database (LBD) to estimate production functions of dairy and sheep/beef firms in New Zealand. Overall, we find that the data enables us to explain much of the industry-level variation in productivity and output, offering greater flexibility and insight than simply examining the official (aggregated) statistics. We find that variation in output can be largely explained by variation in capital, labour, intermediate expenditure, and productive land. We also find differences across industries in the way various farm practices (e.g. stocking rates, fertilizer use, supplementary activities, etc.) and area characteristics (including weather) relate to output. Finally, we find that estimating firm productivity at the industry level is less likely to accurately model the relationships for some sub-groups of firms (e.g. firms with different land size). We believe that our methodology could be useful for future studies addressing research questions relevant to this sector