Ignacio Loeser; Matías Tapia
Abstract: We use census micro data aggregated at the state level data for US cohorts born between 1915 and 1939 to test the impact of secondary and tertiaryschooling in the US at the state-cohort level on R&D and TFP growth across industries in 1970. We instrument our measures of schooling by using the variation in compulsory schooling laws and differences in mobilization rates in WWII, which we relate to the education benefits provided by the GI Bill Act (1944). This novel instrument provides a clean source of variation in the costs of attending college. Two-stage least squared regressions find no effect of the share of population with secondary schooling on outcomes such as n R&D per worker or TFP growth. On the other hand, the share of population with tertiary education has a significant effect on both R&D per worker or TFP growth.
Keywords: Human Capital, R&D, TFP, secondary and tertiary education