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Human capital and economic activity in urban America


Abstract: We examine the relationship between human capital and economic activity in U.S. metropolitan areas, extending the literature in two ways. First, we utilize new data on metropolitan area GDP to measure economic activity. Results show that a one-percentage-point increase in the proportion of residents with a college degree is associated with about a 2 percent increase in metropolitan area GDP per capita. Second, we develop measures of human capital that reflect the types of knowledge within U.S. metropolitan areas. Regional knowledge stocks related to the provision of producer services and information technology are important determinants of economic vitality.

Keywords: productivity; human capital; new economy; knowledge;

JEL Classification: R11; J24; O40;

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Bibliographic Information

Provider: Federal Reserve Bank of New York

Part of Series: Staff Reports

Publication Date: 2010-02-01

Number: 332

Pages: 33 pages

Note: For a published version of this report, see Jaison R. Abel and Todd M. Gabe, "Human Capital and Economic Activity in Urban America," Regional Studies 45, no. 8 (September 2011): 1079-90.