The human capital construct is deep in the bones of economics and finds reference by many classical economists, even if they did not use the phrase. The term “human capital,” seldom mentioned in economics before the 1950s, increased starting in the 1960s and blossomed in the 1990s. The upsurge in NBER publications was even greater. Using EconLit codes from 1990 to 2019, the use of human capital among NBER books increased from 5% to 25%, whereas all economics books changed from 3% to 6%. For NBER working papers, 3% referenced human capital around 1990, but 10% have more recently. The figures for all economics articles are 4% and 6%. The NBER played an outsized role in the rise of the concept of human capital mainly because of the emphasis on empiricism at the NBER. We explore how the NBER was an incubator of human capital research and the ways human capital theory brought the NBER into the modern era of economics.
The Japanese are becoming older. Americans are also becoming older. Demographic stress in Japan, measured by the dependency ratio (DR), is currently about 0.64. In the immediate pre-WWII era it was even higher because Japan’s total fertility rate (TFR) was in the 4 to 5 range. As the TFR began to decline in the post-WWII era, the DR fell and hit a nadir of 0.44 in 1990. But further declining fertility and rising life expectancy caused the DR to shoot up after 1995.
In this short note I simulate the DR under various conditions and make comparisons with the US. Japan has experienced a large increase in its DR because its fertility rate is low, its people are long lived and it has little immigration. Fertility is the largest of the contributors in Japan. If there are no demographic changes in Japan, the DR will be 0.88 by 2050. I also assess the role of the “baby boom” of the late 1940s and show that it was compensatory, unlike that in the US. The good news is that healthier older longer-lived people will continue to be employed for many more years than previously and that is one way to reduce demographic stress.
Why do competitive firms in the US provide paid parental leave (PPL)? Which firms do and to what extent? We use several firm- and individual-level data sets to answer these questions. These include the BLS-Employee Benefit Survey (EBS) for 2010 to 2018 and an extensive firm-level data collection that we compiled. Our work is undergirded by a two-period model with competitive firms whose workers vary by their optimal firm-specific training and the probability that each will remain on the job after PPL is taken. We find that firm-provided PPL has greatly increased in the last two decades and generally covers new fathers. The levels of provision differ greatly by the industry, firm size, and the degree of firm-specific training. But even the top-of-the-line firm in the US provides fewer fully paid parental weeks than does the median OECD nation.
The race between education and technology provides a canonical framework that does a remarkable job of explaining US wage structure changes across the twentieth century. The framework involves secular increases in the demand for more-educated workers from skill-biased technological change, combined with variations in the supply of skills from changes in educational access. We expand the analysis backward and forward. The framework helps explain rising skill differentials in the nineteenth and twenty-first centuries but needs to be augmented to illuminate the recent convexification of education returns and implied slowdown in the growth of the relative demand for college workers.
Females live a lot longer than males in most parts of the world today. But that was not always the case. We ask when and why the female advantage emerged. We show that reductions in maternal mortality and fertility are only partial reasons. Rather, the sharp reduction in infectious disease in the early twentieth century played a role. Those who survive most infectious diseases carry a health burden that affects organs and impacts general well-being. We use newly collected data from Massachusetts containing information on cause of death since 1887 to show that females between the ages of 5 and 25 were disproportionately affected by infectious diseases. Both males and females lived longer as the burden of infectious disease fell, but women were more greatly impacted. Our explanation does not tell us precisely why women live longer than men, but it does help understand the timing of their relative increase.
We explore the first period of sustained decline in child mortality in the U.S. and provide estimates of the independent and combined effects of clean water and effective sewerage systems on under-five mortality. Our case is Massachusetts, 1880 to 1920, when authorities developed a sewerage and water district in the Boston area. We find the two interventions were complementary and together account for approximately one-third of the decline in log child mortality during the 41 years. Our findings are relevant to the developing world and suggest that a piecemeal approach to infrastructure investments is unlikely to significantly improve child health.
American women are working more, through their sixties and even into their seventies. Their increased participation at older ages started in the late 1980s before the turnaround in older men’s labor force participation and the economic downturns of the 2000s. The higher labor force participation of older women consists disproportionately of those working at full-time jobs. Increased labor force participation of women in their older ages is part of the general increase in cohort labor force participation. Cohort effects, in turn, are mainly a function of educational advances and greater prior work experience. But labor force participation rates of the most recent cohorts in their forties are less than those for previous cohorts. These factors may suggest that employment at older ages will stagnate or even decrease. But several other factors will be operating in an opposing direction and leads us to conclude that women are likely to continue to work even longer.
Today, more American women than ever before stay in the workforce into their sixties and seventies. This trend emerged in the 1980s, and has persisted during the past three decades, despite substantial changes in macroeconomic conditions. Why is this so? Today’s older American women work full-time jobs at greater rates than women in other developed countries. In Women Working Longer, editors Claudia Goldin and Lawrence F. Katz assemble new research that presents fresh insights on the phenomenon of working longer. Their findings suggest that education and work experience earlier in life are connected to women’s later-in-life work. Other contributors to the volume investigate additional factors that may play a role in late-life labor supply, such as marital disruption, household finances, and access to retirement benefits. A pioneering study of recent trends in older women’s labor force participation, this collection offers insights valuable to a wide array of social scientists, employers, and policy makers.
Men outnumber women as undergraduate economics majors by three to one nationwide. Even at the best research universities and liberal arts colleges men outnumber women by two to one or more. The Undergraduate Women in Economics Challenge was begun in 2015 as an RCT with 20 treatment schools and at least 30 control schools to evaluate whether better course information, mentoring, encouragement, career counseling, and more relevant instructional content could move the needle. Although the RCT is still in the field, results from several within treatment-school randomized trials demonstrate that uncomplicated and inexpensive interventions can substantially increase the interest of women to major in economics
The gender earnings gap is an expanding statistic over the lifecycle. We use the LEHD Census 2000 to understand the roles of industry, occupation, and establishment 14 years after leaving school. The gap for college graduates 26 to 39 years old expands by 34 log points, most occurring in the first 7 years. About 44 percent is due to disproportionate shifts by men into higher-earning positions, industries, and firms and about 56 percent to differential advances by gender within firms. Widening is greater for married individuals and for those in certain sectors. Non-college graduates experience less widening but with similar patterns.
Pharmacy has become a highly remunerated female-majority profession with a small gender earnings gap and low earnings dispersion relative to other occupations. Using extensive surveys of pharmacists for 2000, 2004, and 2009 as well as the U.S. Census of Population, American Community Surveys and the Current Population Surveys, we explore the gender earnings gap, penalty to part-time work, demographics of pharmacists relative to other college graduates and evolution of the profession during the last half century. We conclude that technological changes increasing the substitutability among pharmacists, the growth of pharmacy employment in retail chains and hospitals, and the related decline of independent pharmacies reduced the penalty to part-time work and have contributed to the narrow gender earnings gap in pharmacy. Our findings on earnings, hours of work and the part-time work wage penalty are more consistent with a shift in technology than a shift in demand preferences on the part of workers in a model of equalizing differences. The position of pharmacist is among the most egalitarian of all U.S. professions today.
We study employers' perceptions of the value of postsecondary degrees using a field experiment. We randomly assign the sector and selectivity of institutions to fictitious resumes and apply to real vacancy postings for business and health jobs on a large online job board. We find that a business bachelor's degree from a for-profit online institution is 22 percent less likely to receive a callback than one from a nonselective public institution. In applications to health jobs, we find that for-profit credentials receive fewer callbacks unless the job requires an external quality indicator such as an occupational license.
Goldin C. Human Capital. In: Handbook of Cliometrics. Heidelberg, Germany: Springer Verlag ; 2016.Abstract
Human capital is the stock of skills that the labor force possesses. The flow of these skills is forthcoming when the return to investment exceeds the cost (both direct and indirect). Returns to these skills are private in the sense that an individual’s productive capacity increases with more of them. But there are often externalities that increase the productive capacity of others when human capital is increased. This essay discusses these concepts historically and focuses on two major components of human capital: education and training, and health. The institutions that encourage human capital investment are discussed, as is the role of human capital in economic growth. The notion that the study of human capital is inherently historical is emphasized and defended.
We examine whether online learning technologies have led to lower prices in higher education. Using data from the Integrated Postsecondary Education Data System, we show that online education is concentrated in large for-profit chains and less-selective public institutions. Colleges with a higher share of online students charge lower tuition prices. We present evidence that real and relative prices for full-time undergraduate online education declined from 2006 to 2013. Although the pattern of results suggests some hope that online technology can “bend the cost curve” in higher education, the impact of online learning on education quality remains uncertain.
Occupations are segregated by sex today, but were far more segregated in the early to mid-twentieth century. It is difficult to rationalize sex segregation and “wage discrimination” on the basis of men’s taste for distance from women in the same way differences between other groups in work and housing have been explained. Rather, this paper constructs a “pollution” theory model of discrimination in which occupations are defined by the level of a single-dimensional productivity characteristic. Because there is asymmetric information regarding the value of the characteristic of an individual woman, a new female hire may reduce the prestige of a previously all-male occupation. The predictions of the model include that occupations requiring a level of the characteristic above the female median will be segregated by sex and those below the median will be integrated. The historical record reveals numerous cases of the model’s predictions. For example in 1940 the greater is the productivity characteristic of an office and clerical occupation, the higher the occupational segregation by sex. “Credentialization” that spreads information about individual women’s productivities and shatters old stereotypes can help expunge “pollution.”
The converging roles of men and women are among the grandest advances in society and the economy in the last century. These aspects of the grand gender convergence are figurative chapters in a history of gender roles. But what must the “last” chapter contain for there to be equality in the labor market? The answer may come as a surprise. The solution does not (necessarily) have to involve government intervention and it need not make men more responsible in the home (although that wouldn’t hurt). But it must involve changes in the labor market, in particular how jobs are structured and remunerated to enhance temporal flexibility. The gender gap in pay would be considerably reduced and might vanish altogether if firms did not have an incentive to disproportionately reward individuals who labored long hours and worked particular hours. Such change has taken off in various sectors, such as technology, science and health, but is less apparent in the corporate, financial and legal worlds.