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The B.E. Journal of Economic Analysis & Policy

Editor-in-Chief: Jürges, Hendrik / Ludwig, Sandra

Ed. by Auriol , Emmanuelle / Brunner, Johann / Fleck, Robert / Mendola, Mariapia / Requate, Till / Schirle, Tammy / de Vries, Frans / Zulehner, Christine

4 Issues per year


IMPACT FACTOR 2016: 0.252
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CiteScore 2016: 0.48

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1935-1682
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Volume 3, Issue 1 (Dec 2003)

Issues

Volume 6 (2006)

Volume 4 (2004)

Volume 2 (2002)

Volume 1 (2001)

Spillovers from Local Market Human Capital and the Spatial Distribution of Productivity in Malaysia

Timothy G. Conley
  • 1University of Chicago, GSB,
/ Fredrick Flyer
  • 2Lexecon, Inc.,
/ Grace R Tsiang
  • 3University of Chicago,
Published Online: 2003-12-24 | DOI: https://doi.org/10.2202/1538-0637.1229

Abstract

This paper examines whether spillovers from local market human capital are important in explaining the distribution of productivity across Malaysia. We develop an empirical method for describing local human capital distributions based on the idea that spillovers are limited in scope by costs of interaction or economic distance between agents. We use estimates of the economic distance between agents to construct measures of local market human capital based on schooling rates of the population within a given radius. These measures are then used in estimating equations obtained from a simple local public goods model. Our regressions are estimated using spatial GMM, allowing for general spatial correlation across observations as a function of economic distance. We find positive wage and rent differentials associated with local human capital, evidence consistent with productive human capital spillovers. Our results for rent differentials obtain with two distinct human capital measures; however, those for wage differentials depend on the human capital measure used.

Keywords: Human Capital Spillovers; Local Public Goods; Spatial GMM

About the article

Published Online: 2003-12-24


Citation Information: Advances in Economic Analysis & Policy, ISSN (Online) 1538-0637, DOI: https://doi.org/10.2202/1538-0637.1229.

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