Education and Other Human Capital
Human capital is the economic value of a worker’s skill set: education, experience and other abilities. Investments in workers raise their quality, which leads to improvements in productivity.
Regions competitive in the 21st-century economy are comprised of competitive companies, which in turn consist of competitive individuals. The more highly skilled a worker, the higher is the worker’s productivity. The educational attainment and skills of workers are more important than at any time in the past. Thus, a region’s educational infrastructure and the educational achievement of its residents are key components of regional competitiveness. Higher education in particular provides benefits not only to those individuals obtaining this advanced education, but to society as a whole.
Analyzes Arizona’s decline in government finance, educational attainment, and economic performance relative to the nation. Since the late 1960s relative to the U.S. average, decreases have occurred in Arizona in the share of the state’s personal income spent by state government, in educational attainment, and in measures of productivity and prosperity.
Related Articles and Reports
Education Pays 2019: The Benefits of Higher Education for Individuals and Society, College Board, January 2020
College Attainment, Income Inequality, and Economic Security: A Simulation Exercise, W.E. Upjohn Institute, January 2020
Talent-Driven Economic Development: A New Vision and Agenda for Regional and State Economies, Brookings Institute, October 2019
Research Note: Combining Early Education and K-12 Investments Has Powerful Positive Effects, Center on Budget and Policy Priorities, February 2019
Evaluating the Return on Investment in Higher Education, Urban Institute, September 2018
Educating a Workforce: Keeping Local Talent, Milken Institute, June 2018
From Preschool to Prosperity: The Economic Payoff to Early Childhood Education, W.E. Upjohn Institute, September 2014
Putting Productivity First, The Information Technology and Innovation Foundation, July 2014
Strong Start. Early Education in Arizona, 103rd Arizona Town Hall, November 2013
Troubling Trends in Arizona’s College Attainment Rate, University of Arizona, Economic and Business Research Center, September 2013
Higher Education Pays: But a Lot More for Some Graduates Than for Others, College Measures, American Institutes for Research, September 2013
A Matter of Degrees: The Effect of Educational Attainment on Regional Economic Prosperity, Milken Institute, February 2013
To Learn and Earn: Arizona’s Unfinished Business in Human Capital, Morrison Institute for Public Policy and Arizona Minority Education Policy Analysis Center, March 2009
America’s Perfect Storm: Three Forces Changing Our Nation’s Future, ETS (Educational Testing Service), January 2007
Estimating the Social Return to Higher Education: Evidence from Longitudinal and Repeated Cross-Sectional Data, Journal of Econometrics, 2004
Workers’ Education, Spillovers and Productivity: Evidence from Plant-Level Production Functions, University of California, Berkeley, January 2004