Human Capital and Development Accounting: New Evidence from Wage Gains at Migration

49 Pages Posted: 14 Nov 2016 Last revised: 11 Jan 2018

See all articles by Lutz Hendricks

Lutz Hendricks

UNC Chapel Hill; CESifo (Center for Economic Studies and Ifo Institute)

Todd Schoellman

Arizona State University (ASU) - W.P. Carey School of Business

Date Written: March 14, 2016

Abstract

We reconsider the role for human capital in accounting for cross-country income differences. Our contribution is to bring to bear new data on the pre- and post- migration labor market experiences of immigrants to the U.S. Immigrants from poor countries experience wage gains that are only 40 percent of the GDP per worker gap, which implies that “country" accounts for 40 percent of income differences, while human capital accounts for 60 percent. Our approach handles selection by comparing the wage of the same individual in two different countries. We also provide evidence on and a correction for skill transfer.

JEL Classification: O11, J31

Suggested Citation

Hendricks, Lutz and Schoellman, Todd, Human Capital and Development Accounting: New Evidence from Wage Gains at Migration (March 14, 2016). CFS Working Paper, No. 557. Available at SSRN: https://ssrn.com/abstract=2869151 or http://dx.doi.org/10.2139/ssrn.2869151

Lutz Hendricks (Contact Author)

UNC Chapel Hill ( email )

Chapel Hill, NC 27599
United States

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Todd Schoellman

Arizona State University (ASU) - W.P. Carey School of Business ( email )

Tempe, AZ 85287-3706
United States

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