The Baby Boomers and the Productivity Slowdown
The entry of baby boomers into the labor market in the 1970s slowed growth for physical and human capital per worker because young workers have little of both. Thus, the baby boom could have contributed to the 1970s productivity slowdown. I build and calibrate a model a la Huggett et al. (2011) with exogenous population and TFP to evaluate this theory. The baby boom accounts for 75% of the slowdown in the period 1964-69, 25% in 1970-74 and 2% in 1975-79. The retiring of baby boomers may cause a 2.8pp decline in productivity growth between 2020 and 2040, ceteris paribus.
Do colleges and universities increase their region's human capital?
We investigate whether the degree production and research and development (R&D) activities of colleges and universities are related to the amount and types of human capital present in the metropolitan areas where the institutions are located. We find that degree production has only a small positive relationship with local stocks of human capital, suggesting that migration plays an important role in the geographic distribution of human capital. Moreover, we show that spillovers from academic R&D activities tilt the structure of local labor markets toward occupations requiring innovation and ...
What Works at Scale? A Framework to Scale Up Workforce Development Programs
Workforce development policymakers have access to a growing catalog of training programs evaluated with rigorous randomized controlled trials. This evidence base identifies programs that work in specific geographic and temporal contexts but may not necessarily work in other contexts or at a scale sufficient to meet regional workforce needs. The author examines a sample of recent randomized controlled trials of workforce development programs and reports to what extent this body of evidence informs policymakers about what works at scale. The author finds that most programs are implemented at a ...
The Value and Risk of Human Capital
Human capital embodies the knowledge, skills, health and values that contribute to making people productive. These qualities, however, are hard to measure, and quantitative studies of human capital are typically based on the valuation of the lifetime income that a person generates in the labor market. This article surveys the theoretical and empirical literature that models a worker?s life-cycle earnings and identifies appropriate discount rates to translate those cash flows into a certainty equivalent of wealth. This paper begins with an overview of a stylized model of human capital ...
Restructuring the Eligibility Policies of the Child Care and Development Fund to Address Benefit Cliffs and Affordability: Florida as a Case Study
This paper explores how the current eligibility policies of the federal Child Care and Development Fund (CCDF) create benefits cliffs that act as barriers to economic self-sufficiency. By examining Florida data and policies, the authors demonstrate how the program’s existing co-payment schedule affects the same hypothetical family living in two contrasting Florida counties: one with state median living costs and one with high living costs. The authors find that the CCDF income eligibility exit threshold is too low, particularly in high-cost counties. That occurs because the exit threshold ...
Firms as Learning Environments: Implications for Earnings Dynamics and Job Search
This paper demonstrates that heterogeneity in firms’ promotion of human capital accumulation is an important determinant of life-cycle earnings inequality. I use administrative micro data from Germany to show that different establishments offer systematically different earnings growth rates for their workers. This observation suggests that that the increase in inequality over the life cycle reflects not only inherent worker variation, but also differences in the firms that workers happen to match with over their lifetimes. To quantify this channel, I develop a life-cycle search model with ...
Family Economics Writ Large
Powerful currents have reshaped the structure of families over the last century. There has been (i) a dramatic drop in fertility and greater parental investment in children; (ii) a rise in married female labor-force participation; (iii) a significant decline in marriage and a rise in divorce; (iv) a higher degree of positive assortative mating; (v) more children living with a single mother; (vi) shifts in social norms governing premarital sex and married women's roles in the workplace. Macroeconomic models explaining these aggregate trends are surveyed. The relent-less flow of technological ...
Minimum wages and firm employment: evidence from China
This paper studies how minimum wage policies affect firm employment in China using a unique county level minimum wage data set matched to disaggregated firm survey data. We investigate both the effect of imposing a minimum wage, and the effect of the policies that tightened enforcement in 2004. We find that the average effect of minimum wage changes is modest and positive, and that there is a detectable effect after enforcement reform. Firms have heterogeneous responses to minimum wage changes which can be accounted for by differences in their wage levels and profit margins: firms with high ...
Human capital and economic activity in urban America
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 ...
The Signaling, Screening, and Human Capital Effects of National Board Certification: Evidence from Chicago and Kentucky High Schools
The National Board for Professional Teaching Standards recognizes teachers who meet performance standards for “accomplished” educators. States and districts provide support for teachers to obtain this certification, which is considered an honor in the field. Using high school data from Chicago and Kentucky, we examine whether participation in the time- and resource-intensive certification process improves teacher productivity and, ultimately, if recognized teachers are of higher quality than their non-certified peers. We find the certification process itself did not increase teacher ...