Human capital spillovers and returns to education

Pedro Portugal; Hugo Reis; Paulo Guimarães; Ana Rute Cardoso

Human capital spillovers and returns to education

Pedro Portugal, Hugo Reis, Paulo Guimarães, Ana Rute Cardoso

Research output: Working paper

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Abstract

In this paper, we quantify the impact of co-workers’ human capital on a worker’s productivity and, more specifically, the spillovers of co-workers’ education within the workplace. We identify the impact of peer quality and provide an unambiguous decomposition of the impact of unobserved heterogeneity on the estimated returns to education. We find that peer effects are quite sizeable. A one standard deviation increase in the measure of peer quality leads to a wage increase of 2.1 percent. We also unveil that an additional year of average education of co-workers yields a 0.5 percent increase in the individual own wage.

Original language	English
Place of Publication	Lisboa
Publisher	Banco de Portugal
Number of pages	43
ISBN (Electronic)	9789896788476
Publication status	Published - Dec 2022

Publication series

Name	Working papers 2022
Publisher	Banco de Portugal
No.	19

Keywords

Wage distribution
Human capital spillovers
Returns to education
Peer effects
Linked employer-employee data
High-dimensional fixed effects
Workplace
Job and occupation

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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91418775Final published version, 8.56 MBLicence: Unspecified

http://hdl.handle.net/10400.14/45469Licence: Unspecified

CUBE: Católica Lisbon Research Unit in Business and Economics
Machado, F. (PI), Aranda, A. M. (Researcher), Costa, A. I. D. A. (Researcher), Martins, A. P. (Researcher), Bernard, A. (Researcher), Fidalgo, A. (Researcher), Reis, C. (Researcher), Abecassis-Moedas, C. (Researcher), Santos, C. (Researcher), Tran, D. (Researcher), Fernandes, D. (Researcher), Bonfim, D. (Researcher), Schliephake, E. (Researcher), Kalogirou, F. (Researcher), Reis, F. (Researcher), Santos, F. (Researcher), Machado, F. (Researcher), Sguera, F. (Researcher), Cerqueiro, G. (Researcher), Reis, H. (Researcher), Barreto, I. (Researcher), Silva, J. (Researcher), Salvado, J. C. (Researcher), Neves, J. C. D. (Researcher), Gijsbrechts, J. (Researcher), Stahl, J. (Researcher), Guedes, J. C. (Researcher), Faias, J. (Researcher), Wagner, L. (Researcher), Correia, I. (Researcher), Saldanha, M. F. (Researcher), Fontes, J. C. (Researcher), Modesto, L. (Researcher), Meira, M. (Researcher), Matos, M. G. D. (Researcher), Gouveia, M. (Researcher), Kozeniauskas, N. (Researcher), Bertani, N. (Researcher), Couzoff, P. (Researcher), Barroso, P. (Researcher), Encarnação, P. (Researcher), Raposo, P. (Researcher), Teles, P. (Researcher), Bastos, W. (Researcher), Bohnsack, R. (Researcher), Vale, R. C. D. (Researcher), Ferreira, R. (Researcher), Lloyd-Braga, T. (Researcher), Ramus, T. (Researcher), Colaço, V. H. (Researcher), Cavicchini, A. (Researcher), Parada, P. (Researcher), Pieters, R. (Researcher), Pinto, F. A. G. D. L. S. (Researcher), Colaço, V. H. (Researcher) & Venter, Z. (Researcher)
1/01/20 → 31/12/24
Project: Research

Cite this

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title = "Human capital spillovers and returns to education",

abstract = "In this paper, we quantify the impact of co-workers{\textquoteright} human capital on a worker{\textquoteright}s productivity and, more specifically, the spillovers of co-workers{\textquoteright} education within the workplace. We identify the impact of peer quality and provide an unambiguous decomposition of the impact of unobserved heterogeneity on the estimated returns to education. We find that peer effects are quite sizeable. A one standard deviation increase in the measure of peer quality leads to a wage increase of 2.1 percent. We also unveil that an additional year of average education of co-workers yields a 0.5 percent increase in the individual own wage.",

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year = "2022",

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AU - Portugal, Pedro

AU - Reis, Hugo

AU - Guimarães, Paulo

AU - Cardoso, Ana Rute

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N2 - In this paper, we quantify the impact of co-workers’ human capital on a worker’s productivity and, more specifically, the spillovers of co-workers’ education within the workplace. We identify the impact of peer quality and provide an unambiguous decomposition of the impact of unobserved heterogeneity on the estimated returns to education. We find that peer effects are quite sizeable. A one standard deviation increase in the measure of peer quality leads to a wage increase of 2.1 percent. We also unveil that an additional year of average education of co-workers yields a 0.5 percent increase in the individual own wage.

AB - In this paper, we quantify the impact of co-workers’ human capital on a worker’s productivity and, more specifically, the spillovers of co-workers’ education within the workplace. We identify the impact of peer quality and provide an unambiguous decomposition of the impact of unobserved heterogeneity on the estimated returns to education. We find that peer effects are quite sizeable. A one standard deviation increase in the measure of peer quality leads to a wage increase of 2.1 percent. We also unveil that an additional year of average education of co-workers yields a 0.5 percent increase in the individual own wage.

KW - Wage distribution

KW - Human capital spillovers

KW - Returns to education

KW - Peer effects

KW - Linked employer-employee data

KW - High-dimensional fixed effects

KW - Workplace

KW - Job and occupation

M3 - Working paper

T3 - Working papers 2022

BT - Human capital spillovers and returns to education

PB - Banco de Portugal

CY - Lisboa

ER -

Human capital spillovers and returns to education

Abstract

Publication series

Keywords

UN SDGs

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Projects

CUBE: Católica Lisbon Research Unit in Business and Economics

Cite this