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Factor Endowments and the Returns to Skill: New Evidence from the American Past

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  • Joseph P. Kaboski
  • Trevon D. Logan

Abstract

Existing skill-biased technical change theory predicts that differences in factor endowments will affect technology adoption and the return to skill. We document regional variation in endowments in the American past. We then estimate the returns to education using a new data source: a report from the Commissioner of Education in 1909. We find significant variation in the returns to schooling aligned with differences in resource endowments, with large (within-occupation) returns in the Midwest and Southwest but much lower returns in the South and West. Our results appear generalizable to broader returns to education in the United States.

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  • Joseph P. Kaboski & Trevon D. Logan, 2011. "Factor Endowments and the Returns to Skill: New Evidence from the American Past," Journal of Human Capital, University of Chicago Press, vol. 5(2), pages 111-152.
    • Handle: RePEc:ucp:jhucap:doi:10.1086/660297
    DOI: 10.1086/660297
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    Cited by:

    1. Stephen J. Turnovsky & Aditi Mitra, 2013. "The Interaction between Human and Physical Capital Accumulation and the Growth-Inequality Trade-off," Journal of Human Capital, University of Chicago Press, vol. 7(1), pages 26-75.
    2. Parag A. Pathak & Peng Shi, 2014. "Demand Modeling, Forecasting, and Counterfactuals, Part I," NBER Working Papers 19859, National Bureau of Economic Research, Inc.

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    More about this item

    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • N3 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy

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