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Geographic and sector externalities from highly qualified human capital: the importance of the business service sector

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  • Joilson Dias
  • Florian Schumacher
  • Edinaldo Tebaldi

Abstract

This article develops a simple model where knowledge spillover is related to geography and sectors of the economy. Knowledge externality comes from those with college degree at sector level and the relative size of the business service sector at geographic level. We examine the model using data from Brazilian National Household Survey (PNAD) for the year 2008. We find evidence that sector concentration of highly qualified workers (with at least a college degree) generates knowledge externalities. Hence, workers benefit from the skills of their peers by learning from them. Also complementing the literature, we find a geographic knowledge spillover played by the business service sector. This last result holds even if we estimate rates of return to education by sectors or estimate wage regressions over sectors (not shown). This article also provides evidence of increasing returns to schooling in Brazil.

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  • Joilson Dias & Florian Schumacher & Edinaldo Tebaldi, 2014. "Geographic and sector externalities from highly qualified human capital: the importance of the business service sector," Applied Economics Letters, Taylor & Francis Journals, vol. 21(5), pages 329-334, March.
    • Handle: RePEc:taf:apeclt:v:21:y:2014:i:5:p:329-334
    DOI: 10.1080/13504851.2013.859367
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    2. Peter Mayerhofer & Matthias Firgo, 2015. "Wissensintensive Unternehmensdienste, Wissens-Spillovers und regionales Wachstum. Teilprojekt 2: Strukturwandel und regionales Wachstum – Wissensintensive Unternehmensdienste als "Wachstumsmotor&," WIFO Studies, WIFO, number 58503.

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