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Globalization and Human Capital Investment: How Export Composition Drives Educational Attainment

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Abstract
This paper demonstrates that the composition of a country's exports is an important driver of educational attainment. Using detailed trade data and a gravity-based IV technique, we identify the causal impact of changes in the pattern of a country's exports on subsequent educational attainment. Relying on within-country variation over forty-five years for more than one hundred countries, our empirical analysis shows that exports of low-skill-intensive goods depresses average years of schooling - particularly at the primary level - while exports of skill-intensive goods increases years of schooling - at higher rungs of the educational ladder. Our results provide new insights into which types of sectoral growth are most beneficial for long-term human capital formation and suggest that trade can exacerbate initial differences in factor endowments across countries.

Suggested Citation

  • Emily Blanchard & William W. Olney, 2013. "Globalization and Human Capital Investment: How Export Composition Drives Educational Attainment," Department of Economics Working Papers 2013-18, Department of Economics, Williams College, revised Mar 2015.
    • Handle: RePEc:wil:wileco:2013-18
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    Cited by:

    1. Keller, Wolfgang & Olney, William W., 2021. "Globalization and executive compensation," Journal of International Economics, Elsevier, vol. 129(C).
    2. Giacomo Magistretti & Marco Tabellini, 2018. "Economic Integration and Democracy: An Empirical Investigation," Harvard Business School Working Papers 19-003, Harvard Business School.
    3. Roberto Alvarez & Damián Vergara, 2016. "Natural Resources and Education: Evidence from Chile," Working Papers wp433, University of Chile, Department of Economics.
    4. Rotunno, Lorenzo & Wood, Adrian, 2020. "Wage inequality and skill supplies in a globalised world," Journal of Comparative Economics, Elsevier, vol. 48(3), pages 529-547.
    5. Gu, Grace Weishi & Malik, Samreen & Pozzoli, Dario & Rocha, Vera, 2016. "Trade Induced Skill Upgrading: Lessons from the Danish and Portuguese Experiences," IZA Discussion Papers 10035, Institute of Labor Economics (IZA).
    6. Adrian Wood, 2017. "Variation in structural change around the world, 1985–2015: Patterns, causes and implications," WIDER Working Paper Series 034a, World Institute for Development Economic Research (UNU-WIDER).
    7. Almansour, Abdullah, 2023. "Crude oil cycles and the choice of private vs public school: Evidence from Saudi Arabia," Resources Policy, Elsevier, vol. 85(PA).
    8. Greenland, Andrew & Lopresti, John, 2016. "Import exposure and human capital adjustment: Evidence from the U.S," Journal of International Economics, Elsevier, vol. 100(C), pages 50-60.
    9. Tabellini, Marco & Magistretti, Giacomo, 2020. "Economic Integration and Democracy: An Empirical Investigation," CEPR Discussion Papers 14336, C.E.P.R. Discussion Papers.

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    More about this item

    Keywords

    Exports; Education; Human Capital; Structural Change;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity

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