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Title: Economic Effects of Universities and Colleges
Citation Type: Miscellaneous
Publication Year: 2011
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Abstract: Based on the success of Boston, Silicon Valley and the Research Triangle, po licy makers are increasingly looking to universities and colleges as engines of technological innovation and economic growth. Using panel data on metropolitan areas from 1980 to 2000, this paper estimates the spillover effects of activities of universities and colleges on economic outcomes of individuals in a local economy. Per capita academic R&D, share of science degrees in total bachelors' degrees and stock of college graduates in a metropolitan area are the measures of university activity. The panel structure of the data allows me to include fixed effects for metropolitan areas and time. To further investigate causality, I use deep lags of university activities and presence of land grant universities interacted with a dummy variable for decades, as instrumental variables. Per capita academic R&D and stock of college graduates in a metropolitan area have positive and significant effect on individual wages. The stock of college graduate in a metropolitan area is an important determinant of individual employment. In contrast, the effect of share of science degrees and per capita academic R&D appear to have more important effect on average employment. The results are also empirically important. One standard deviation increase in academic R&D increases wages by .8% and probability of individual employment probability by 0.02%. One standard deviation increase in share of science degrees increases wages by .4% and the probability of individual employment by 0.03%. One standard deviation increase in stock of college grads degrees increases wages by 4% and the probability of individual employment by 1%. JEL Classification: O18, O31, O32, R11, J01 I wish to thank Bruce Weinberg, Francisca Richter, Paul Bauer and Mark Schweitzer for helpful discussions; seminar participants at the Federal Reserve Bank of Cleveland, Cleveland State University and The Ohio State University for comments. 2
Url: https://www.csuohio.edu/class/sites/csuohio.edu.class/files/media/economics/documents/19.pdf
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Authors: Saha, Subhra B
Publisher: Cleveland State University
Data Collections: IPUMS USA
Topics: Education, Other
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