Economic impact of education: evidence and relevance

No abstract available

Expenditure impacts of higher education institutions and their spatial distribution : Glasgow city region v the rest of Scotland

Several previous studies have established that higher education is a significant sector in the Scottish economy. The most recent of these find the expenditure of Higher Education Institutions (HEIs) and their staf support approximately 4% of gross output in Scotland, based on conventional multiplier based impact attribution. If the role of Scottish Government funding is discounted (due to the binding budget constraint imposed by the Barnett funding mechanism) this is still a sizeable 2%; indicating that higher education is a significant export sector (for details see: Hermannsson et al 2013ab). It has long been recognised that higher education as a sector is even more important for the local economies where the HEIs are concentrated. For example, in a 1966 issue of the Scottish Journal of Political Economy Blake and McDowell settle the argument, which is more important for the economy of St Andrews, the university or the golf course. This article analyses the role of higher education in the economy of Glasgow (GLA) and the rest of the Strathclyde regions (RST). The aim is to compare and contrast the impact of the west coast institutions to the impacts of HEIs in the rest of Scotland (ROS). In particular the aim is to examine the degree to which the spatial distribution of HE activities between the West and the ROS is determined by Scottish Government funding decisions and to what extent this is driven by success at securing external students and funding

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

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

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

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

“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