WP 9: Outcomes of skills

To address the objectives listed above and provide answers to the key question, this Work Package primarily applies the following methods:

• We investigate the difference in effects of higher education between full-time students and those who held a job while attending schools, based on data from the Chinese Household Income Project (1995-2007).
• We investigate the influence of foreign language skills on human capital transferability based on immigrant data from the USA Panel study of Income Dynamic, and adopt a comprehensive measurement of an immigrant's foreign language proficiency.
• We try to link individual level human capital to regional income inequality and estimate its effect on regional income inequality, using both individual level and regional level data from China. At the individual level, we decompose human capital into measured and unmeasured skills.

Research related to this Work Package is still ongoing, but the interim results show that:

• We find that the schooling returns to a college or a graduate degree earned while working are significantly lower than the returns on corresponding degrees earned via full-time studies. Our further investigation shows that school quality, student quality, or aging cannot explain the gap. We discuss other possible explanations: differences in career wage paths and signaling effects.
• We find that one's foreign language proficiency not only directly improves his/her labor market performance but also facilitates human capital transferability.
• We find that regional differences in unobserved skills contribute much to the regional income gaps.

Our research draws implications for corporate training strategy, national education policies and regional development strategies.