Human Capital Depreciation

Michael Dinerstein, Rigissa Megalokonomou and Constantine Yannelis

No 2020-146, Working Papers from Becker Friedman Institute for Research In Economics

Abstract: Human capital can depreciate if skills are unused. But estimating human capital depreciation is challenging, as worker skills are difficult to measure and less productive workers are more likely to spend time in non-employment. We overcome these challenges with new administrative data on teachers’ assignments and their students’ outcomes, and quasi- random variation from the teacher assignment process in Greece. We find significant losses to output, as a one-year increase in time without formal employment lowers students’ test scores by 0.09 standard deviations. Using a simple production model, we estimate a skill depreciation rate of 4.3% and experience returns of 6.8%.

JEL-codes: H52 I26 J24 (search for similar items in EconPapers)
Pages: 102 pages
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

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Working Paper: Human Capital Depreciation (2020)
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