Cross-country variation in educational attainment: structural change or within-industry skill upgrading?
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- Hendricks, L. J Econ Growth (2010) 15: 205. doi:10.1007/s10887-010-9055-9
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Educational attainment varies greatly across countries and within countries over time. This paper asks whether the variation in education is primarily due to industry composition or to within-industry skill intensities. The main finding is that within-industry variation accounts for at least two-thirds of the cross-country and the time-series variation in educational attainment. The within-industry education gaps are broadly consistent with a model of industry neutral cross-country differences in skilled labor productivity. These results suggest that theories of educational development should focus on skill upgrading within industries rather than structural change.