TY  - JOUR
AU  - Ciccone,Antonio
AU  - Peri,Giovanni
TI  - Schooling Supply and the Structure of Production: Evidence from US States 1950-1990
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 17683
PY  - 2011
Y2  - December 2011
UR  - http://www.nber.org/papers/w17683
L1  - http://www.nber.org/papers/w17683.pdf
N1  - Author contact info:
Antonio Ciccone
Universitat Pompeu Fabra
E-Mail: antonio.ciccone@upf.edu

Giovanni Peri
Department of Economics
University of California, Davis
One Shields Avenue
Davis, CA 95616
Tel: 530/752-3033
E-Mail: gperi@ucdavis.edu
AB  - We find that over the period 1950-1990, US states absorbed increases in the supply of schooling due to tighter compulsory schooling and child labor laws mostly through within-industry increases in the schooling intensity of production. Shifts in the industry composition towards more schooling-intensive industries played a less important role. To try and understand this finding theoretically, we consider a free trade model with two goods/industries, two skill types, and many regions that produce a fixed range of differentiated varieties of the same goods. We find that a calibrated version of the model can account for shifts in schooling supply being mostly absorbed through within-industry increases in the schooling intensity of production even if the elasticity of substitution between varieties is substantially higher than estimates in the literature.
ER  -