Economic impact of education: evidence and relevance

No abstract available

Beyond intermediates: the role of consumption and commuting in the construction of local input-output tables

Estimating intermediate trade using conventional non-survey methods produces biased results. This problem has led to a methodological recommendation that emphasises the accurate estimation of intermediate trade flows. This paper argues for a qualification of the consensus view: when simulating input-output (IO) tables, analysts need also to consider spill-over effects driven by wage and consumption flows. In particular, for metropolitan economies, capturing wage and consumption flows is essential to obtain accurate Type II multipliers. This is demonstrated by constructing an interregional IO table, which captures the interdependence between a city and its commuter belt, nested within the wider regional economy

Returns to Education and Social Class: Cross Sectional Evidence for Vocational and Academic Qualifications

A wave of recent empirical work has uncovered a social class-wage gap in several advanced economies, where individuals from working class backgrounds get paid less than those with identical observable characteristics, but from a higher social class. This observation has been referred to as the "class ceiling" on account of similarities with the gender pay gap. Hitherto, this work has primarily focussed on individuals with graduate qualifications. I extend this analysis to the full range of qualifications in the UK labour market, separately identifying different levels of vocational and academic qualifications. This draws on a recent innovation in the UK Quarterly Labour Force Survey, which contains a social class variable from 2014 onwards. This analysis shows that an average class wage gap masks heterogeneity in the severity of wage penalties across different social classes and educational routes. For individuals in the most disadvantaged group findings are mixed. Overall, the wage gaps observed for those with vocational qualifications are modest in magnitude (around 5%) and weakly statistically significant. For most academic qualifications the gap is strongly significant and ranges from 8% to 13%. A notable exception is undergraduate qualifications, for which interaction terms with class are not significant

Returns to Education and Social Class: Cross Sectional Evidence for Vocational and Academic Qualifications

A wave of recent empirical work has uncovered a social class-wage gap in several advanced economies, where individuals from working class backgrounds get paid less than those with identical observable characteristics, but from a higher social class. This observation has been referred to as the "class ceiling" on account of similarities with the gender pay gap. Hitherto, this work has primarily focussed on individuals with graduate qualifications. I extend this analysis to the full range of qualifications in the UK labour market, separately identifying different levels of vocational and academic qualifications. This draws on a recent innovation in the UK Quarterly Labour Force Survey, which contains a social class variable from 2014 onwards. This analysis shows that an average class wage gap masks heterogeneity in the severity of wage penalties across different social classes and educational routes. For individuals in the most disadvantaged group findings are mixed. Overall, the wage gaps observed for those with vocational qualifications are modest in magnitude (around 5%) and weakly statistically significant. For most academic qualifications the gap is strongly significant and ranges from 8% to 13%. A notable exception is undergraduate qualifications, for which interaction terms with class are not significant

The relevance of the periphery for economic policy

This special issue of the Fraser Economic Commentary presents a diverse selection of papers on peripheral economies. These are a sample of papers presented at an international conference of the Regional Studies Association (RSA) research network on Peripherality, Marginality and Border Issues in Northern Europe in September 2012. The conference was hosted by the University Centre of the Westfjords in Ísafjörður, Iceland. This followed previous successful standalone events organized by the network in Norway and Scotland, as well as various special sessions at other RSA events. The papers are diverse in terms of the geographical areas they focus on, both within the UK and its neighbours in the Nordic countries. The methods are diverse, as are the disciplinary backgrounds of the participants

“Policy scepticism” and the impact of London based higher edication institutions (HEIS) on the economy of England : accounting for alternative uses of public expenditure

This paper replicates the analysis of Scottish HEIs in Hermannsson et al (2010a) for the case of London-based HEIs’ impact on the English economy in order to provide a self-contained analysis that is readily accessible by those whose primary concern is with the regional impacts of London HEIs. A “policy scepticism” has emerged that challenges the results of conventional regional HEI impact analyses. This denial of the importance of the expenditure impacts of HEIs appears to be based on a belief in either a binding regional resource constraint or a regional public sector budget constraint. In this paper we provide a systematic critique of this policy scepticism. However, while rejecting the extreme form of policy scepticism, we argue that it is crucial to recognise the importance of alternative uses of public expenditure, and show how conventional impact analyses can be augmented to accommodate this. While our results suggest that conventional impact studies overestimate the expenditure impacts of HEIs, they also demonstrate that the policy scepticism that treats these expenditure effects as irrelevant neglects some key aspects of HEIs, in particular their export intensity

Review of Suzuki and Nijkamp': "Regional Performance Measurement and Improvement: New Developments and Applications of Data Envelopment Analysis"

No abstract available

“Policy scepticism” and the impact of Scottish Higher Education Institutions (HEIs) on their host region: accounting for regional budget constraints under devolution

A “policy scepticism” has emerged that challenges the results of conventional regional HEI impact analyses. Its denial of the importance of the expenditure impacts of HEIs appears to be based on a belief in either a binding regional resource constraint or a regional public sector budget constraint. In this paper we provide a systematic critique of this policy scepticism. However, while rejecting the extreme form of policy scepticism, we argue that it is crucial to recognise the importance of the public-sector expenditure constraints that are binding under devolution. We show how conventional impact analyses can be augmented to accommodate regional public sector budget constraints. While our results suggest that conventional impact studies overestimate the expenditure impacts of HEIs, they also demonstrate that the policy scepticism that treats these expenditure effects as irrelevant neglects some key aspects of HEIs, in particular their export intensity

An HEI-disaggregated input-output table for Wales

This paper describes how the education sector of the Welsh Input-Output tables is disaggregated to identify a separate sector for each of Wales’s twelve Higher Education Institutions (HEIs). The process draws on accounting and survey data to accurately determine the incomes and expenditures of each institution. In particular we emphasise determining the HEIs incomes source of origin to inform their treatment, as endogenous or exogenous, in subsequent analyses. The HEI-disaggregated Input-Output table provides a useful descriptive snapshot of the Welsh economy and the role of HEIs within it for a particular year, 2006. The table can be used to derive multipliers and conduct various impact studies of each institution or the sector as a whole. The table is furthermore useful to calibrate other multi-sectoral, HEI-disaggregated models of regional economies, including Social Accounting Matrix (SAM) and computable general equilibrium (CGE) models

The expenditure impacts of individual higher education institutions (HEIS) and their students on the Welsh economy : homogeneity or heterogeneity?

This paper replicates the analysis of Scottish HEIs in Hermannsson et al (2010a) for the case of Wales in order to provide a self-contained analysis that is readily accessible by those whose primary concern is with the regional impacts of Welsh HEIs. When we treat each of the twelve Higher Education Institutions (HEIs) that existed in Wales in 2006 as separate sectors in conventional input-output analysis, their expenditure impacts per unit of final demand appear rather homogenous, with the apparent heterogeneity of their overall impacts being primarily driven by scale. However, a disaggregation of their income by source reveals considerable variation in their dependence upon funding from the devolved Welsh Assembly Government and their ability to draw in income/funding from external sources. Acknowledging the binding budget constraint of the Welsh Assembly Government and deriving balanced expenditure multipliers reveals large differences in the net-expenditure impact of HEIs upon the Welsh economy, with the source of variation being the origin of income. Applying a novel treatment of student expenditure impacts, identifying the amount of exogenous spending per student, modifies the heterogeneity of the overall expenditure impacts. On balance this suggests that the impacts of impending budget cut-backs will be quite different by institution depending on their sensitivity to public funding. However, predicting the outcome of budget cutbacks at the margin is problematic for reasons that we identify