Abstract:
This paper proposes that imported capital goods, which embody
skill-complementary technologies, can lead to an increase in the
supply of skill in developing countries like China. By exploiting the
cross-prefecture variation in imported capital goods, I show that the
surge in imported capital goods encourages human capital accumulation
and migration in China. To tackle causality, I instrument a
prefecture's import growth of capital goods with that in other
regions. There are three main findings. Firstly, the regional
difference in imported capital goods can explain 27 percent of the
regional difference in college share between 2000 and 2010. A
prefecture with a $100 increase in imported capital goods per capita
had a 1.4 percentage points increase in college share. Secondly, this
paper quantifies the importance of the three channels, namely skill
acquisition of local stayers, immigration of skilled workers, and
emigration of skilled workers, through which imported capital goods
increase college share. I find that the first channel is the most
important. Thirdly, I trace out the responses of skill supply to the
demand shift. I find that imported capital goods increase college wage
premium and the effect attenuates over time with the increase in skill
supply.
Frisch seminar: Lei Li
Skill-Biased Imports, Human Capital Accumulation, and the Allocation of Talent
Zoom -> https://frisch-no.zoom.us/j/66340045897?pwd=QTJhQ1RabkdVckJKMnBzMGFZWWdVQT09
Published Aug. 25, 2020 10:24 AM
- Last modified Nov. 9, 2020 10:42 AM