revised version published in: Economics of Education Review, 2014, 41, 161-175
We use a unique firm-level data set merging administrative information on average wages paid by firms by skill level (blue collars and white collars), Population Census information on the local stock of human capital available to firms and survey information on firm characteristics to investigate the existence and magnitude of local human capital externalities in Italian Manufacturing. The latter represents an interesting case study due to the prevalence of small family business and a technological lag with respect to the US, to which most evidence supporting local human capital spillovers refers. Our estimates show that in Italy, like in the US, firms located in geographical areas with a higher stock of human capital pay higher wages. This evidence is robust to many variants of the econometric specification and to addressing potential endogeneity issues using instrumental variables estimation and instruments based on the lagged expansion of the Italian higher education system and the lagged demographic structure.
We use cookies to provide you with an optimal website experience. This includes cookies that are necessary for the operation of the site as well as cookies that are only used for anonymous statistical purposes, for comfort settings or to display personalized content. You can decide for yourself which categories you want to allow. Please note that based on your settings, you may not be able to use all of the site's functions.
Cookie settings
These necessary cookies are required to activate the core functionality of the website. An opt-out from these technologies is not available.
In order to further improve our offer and our website, we collect anonymous data for statistics and analyses. With the help of these cookies we can, for example, determine the number of visitors and the effect of certain pages on our website and optimize our content.