Human capital, migration and local labour markets : the role of the higher education system in Great Britain

• Main Author: Faggian, Alessandra
• Published: University of Reading 2005
• Subjects: 331.120941
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.553098

The positive impact of higher education institutions (HEI) on local economies has been long acknowledged, but it has generally been evaluated by using regional multipliers or input-output techniques, which are static in nature and more focused on short-term effects. This study tried to give a more complete and dynamic account of how HEI are affecting the local economies by incorporating into the analysis the role of human capital and interregional migration. My analysis is based on micro- econometric data on around 800,000 British students graduating between the academic years 1996-97 and 1999-00. In order to analyse the data I employ dichotomous, multinomial, and conditional logit models, which investigate how the characteristics of the individuals, the institutions, and the regions together determine graduate migration behaviour. Most of my results on the determinants of student migration were in line with the expectations of the traditional migration research although some surprising results were also revealed. One of the most interesting results is the different attitude of men and women towards migration to study and migration to work. Another important result is the effect of the final degree classification on graduate migration. In the last part of the thesis we used the knowledge developed on student and graduate migration to study the relationship between innovation and human capital flows. Given the nature of the problem, we move away from a micro-econometric framework to use simultaneous equation models, which better account for the feedback mechanisms between the two phenomena under investigation. The results show that the primary role of the university system appears to be as acting as a conduit for bringing potential high quality undergraduate human capital into a region. If the region is already economically buoyant, many of these migrants will remain in the university region for employment after graduation, subsequently contributing to the region's innovative performance. The migration effects of embodied human capital appear far more important than informal university-industry spillovers as an explanation of regional learning effects.