Globalization and Human Capital Investment: How Export Composition Drives Educational Attainment

Emily Blanchard and William Olney

No 2013-18, Department of Economics Working Papers from Department of Economics, Williams College

Abstract: This paper demonstrates that the composition of a country's exports is an important driver of educational attainment. Using detailed trade data and a gravity-based IV technique, we identify the causal impact of changes in the pattern of a country's exports on subsequent educational attainment. Relying on within-country variation over forty-five years for more than one hundred countries, our empirical analysis shows that exports of low-skill-intensive goods depresses average years of schooling - particularly at the primary level - while exports of skill-intensive goods increases years of schooling - at higher rungs of the educational ladder. Our results provide new insights into which types of sectoral growth are most beneficial for long-term human capital formation and suggest that trade can exacerbate initial differences in factor endowments across countries.

Keywords: Exports; Education; Human Capital; Structural Change (search for similar items in EconPapers)
JEL-codes: F14 F16 J24 (search for similar items in EconPapers)
Pages: 54 pages
Date: 2013-11, Revised 2015-03
New Economics Papers: this item is included in nep-edu, nep-hrm and nep-int
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