Do Colleges and Universities Increase Their Region’s Human Capital?

51 Pages Posted: 4 Nov 2009 Last revised: 27 Mar 2011

See all articles by Jaison R. Abel

Jaison R. Abel

Federal Reserve Bank of New York

Richard Deitz

Federal Reserve Bank of New York - Research Group

Date Written: March 21, 2011

Abstract

We investigate whether the degree production and R&D activities of colleges and universities are related to the amount and types of human capital in the metropolitan areas where they are located. Our results indicate only a small positive relationship exists between a metropolitan area’s production and stock of human capital, suggesting that migration plays an important role in the geographic distribution of human capital. We also find that academic R&D activities increase local human capital levels, suggesting that spillovers from such activities can raise the demand for human capital. Consistent with these results, we show that metropolitan areas with more higher education activity tend to have a larger share of workers in high human capital occupations. Thus, this research indicates that colleges and universities can raise local human capital levels by increasing both the supply of and demand for skill.

Keywords: human capital, higher education, knowledge spillovers, local economic development

JEL Classification: R10, J24, O18

Suggested Citation

Abel, Jaison R. and Deitz, Richard, Do Colleges and Universities Increase Their Region’s Human Capital? (March 21, 2011). FRB of New York Staff Report No. 401, Available at SSRN: https://ssrn.com/abstract=1499412 or http://dx.doi.org/10.2139/ssrn.1499412

Jaison R. Abel (Contact Author)

Federal Reserve Bank of New York ( email )

33 Liberty Street
New York, NY 10045
United States

Richard Deitz

Federal Reserve Bank of New York - Research Group ( email )

33 Liberty Street
New York, NY 10045
United States

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