Endogenous skill-biased technology adoption: Evidence from China's college enrollment expansion
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AbstractChina's college expansion program, which was implemented in 1999 signi cantly
increased the share of college-educated workers in the urban labor force. We nd
that returns to education were not responsive to changes in local skill supply be-
tween then and 2009. To explain the trend, we develop a model of endogenous
technology adoption and predict that increasing the share of college-educated work-
ers leads rms to adjust their use of production technology. We construct supply
shocks in local labor markets based on policy-driven variations in the changes of
college enrollment quotas across cities. Using panel data from over 20,000 large
manufacturing rms, we nd that an enlarged college-educated labor force causes
skill-intensive rms to invest more in capital and R&D as well as employ more
workers, evidence that supports the theory of endogenous technology adoption.
Acceptance Date16/02/2019
All Author(s) ListShuaizhang Feng, Xiaoyu Xia
Name of ConferenceSociety of Labor Economists Conference
Start Date of Conference03/05/2019
End Date of Conference04/05/2019
Place of ConferenceArlington, United States
Country/Region of ConferenceUnited States of America
LanguagesEnglish-United States

Last updated on 2020-09-04 at 17:04