Long-Run Substitutability between More and Less Educated Workers: Evidence from U.S. States 1950-1990

Antonio Ciccone and Giovanni Peri ()

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: We estimate the aggregate long-run elasticity of substitution between more and less educated workers (the slope of the demand curve for more relative to less educated workers) at the US state level. Our data come from the (five)1950-1990 decennial censuses. Our empirical approach allows for state and time fixed effects and relies on time and state dependent child labor and compulsory school attendance laws as instruments for (endogenous) changes in the relative supply of more educated workers. We find the aggregate long-run elasticity of substitution between more and less educated workers to be around 1.5.

Keywords: Elasticity of Substitution; Education; U.S. States; Skill Biased Technological Change (search for similar items in EconPapers)
JEL-codes: J3 R1 O3 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dev and nep-geo
Date: Written
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Related works:
Journal Article: Long-Run Substitutability Between More and Less Educated Workers: Evidence from U.S. States, 1950-1990 (2005)
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Persistent link: http://EconPapers.repec.org/RePEc:upf:upfgen:764

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