Human Capital and Economic Activity in Urban America

33 Pages Posted: 17 Jul 2008 Last revised: 6 Sep 2014

Jaison R. Abel

Federal Reserve Bank of New York

Todd M. Gabe

University of Maine - School of Economics

Date Written: February 2010

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: human capital, knowledge, new economy, productivity

JEL Classification: R11, J24, O40

Suggested Citation

Abel, Jaison R. and Gabe, Todd M., Human Capital and Economic Activity in Urban America (February 2010). FRB of New York Staff Report No. 332. Available at SSRN: https://ssrn.com/abstract=1161184 or http://dx.doi.org/10.2139/ssrn.1161184

Jaison R. Abel (Contact Author)

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

Todd M. Gabe

University of Maine - School of Economics ( email )

Orono, ME 04469-5774
United States

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