Full Citation

Title: Knowledge Capital and Aggregate Income Differences: Development Accounting for US States

Citation Type: Journal Article

Publication Year: 2017

ISBN:

ISSN:

DOI: https://doi.org/10.1257/mac.20160255

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Abstract: Improvement in human capital is often presumed to be important for state economic development, but little research links better education to state incomes. We develop detailed measures of worker skills in each state that incorporate cognitive skills from state- and countryof-origin achievement tests. These new measures of knowledge capital permit development accounting analyses calibrated with standard production parameters. Differences in knowledge capital account for 20–30 percent of the state variation in per capita GDP, with roughly even contributions by school attainment and cognitive skills. Similar results emerge from growth accounting analyses. These estimates support school improvement as a strategy for state economic development.

Url: https://pubs.aeaweb.org/doi/pdfplus/10.1257/mac.20160255

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Authors: Hanushek, Eric, A; Jens, Ruhose; Ludger, Woessmann

Periodical (Full): American Economic Journal: Macroeconomics

Issue: 4

Volume: 9

Pages: 184-224

Data Collections: IPUMS USA

Topics: Education, Labor Force and Occupational Structure, Other

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