Relationship between graduates and economic growth across
countries
Call for Expressions of Interest
Background
There are various mechanisms by which HE contributes to economic growth.
One that is often cited is the number of graduates in an economy – both the
stock, and the growth in this stock (the flow).
Analyses exploring this relationship have included Gemmell (1996) – cited in
Sianesi & Van Reenen (2003)1 – which used data from across OECD
countries and estimated that a 1% increase in tertiary human capital stock
was associated with a 1.1 percentage point increase in per capita GDP
growth rates.
The economics paper that accompanied last year’s HE White Paper briefly
reviewed some of the thinking and analysis on the subject (BIS 2011 - chapter
22) and noted that:
“Overall, Sianesi and Van Reenen conclude that the literature indicates a
positive relationship between human capital measures and growth. For
example, for tertiary education, Gemmell (1996) finds evidence for both
the initial stock and subsequent growth in education exerting a positive
impact on GDP growth across OECD countries between 1960 and 1985.”
Given the debate about what are the key variables influencing growth in terms
of the number of graduates (eg. stock v. flow, HE enrolments v. HE qualifiers),
and the fact that some of the earlier findings are now out-of-date (eg.
Gemmell used data from 1960-1985), BIS wishes to conduct further research
to explore the relationship and up-date the findings on the statistical
association.
Key Objectives
The primary aim is to explore the relationship between graduates and
economic growth, and to quantify the relationship.
We anticipate four stages, some of which will run concurrently:
Sianesi, B. and J. Van Reenen (2003), ‘The returns to education: a review of the macroeconomic literature’, Journal of Economic Surveys vol. 17 (2), pp. 157-200
2 BIS 2011, Supporting Analysis for the Higher Education White Paper, BIS Economics Paper
No. 14, June 2011
1
1
1. An initial literature review/overview of the key evidence on the
relationship between HE and economic growth – in general, and
particularly with respect to the number of / growth in number of
graduates.
2. Exploration of the appropriate economic framework and metrics (for
graduates and for growth) to use in order to assess the relationship.
3. Analysing recent (eg. last 20 years) OECD data across countries on
graduates (numbers, proportions, growth) and on GDP (level, per
capita, growth) to establish if there is an association between them,
and to quantify the association.
4. Econometric modelling to isolate the impact of graduates on GDP
relative to other variables that affect it (or at least exploring the
possibility of doing this).
The contractor would present their work in a report to be published by BIS,
and in a seminar. As well as presenting the findings and conclusions the
report must clearly outline the methodology, constraints to the calculations
and comparability with previous estimates.
Provisional Timescales
Closing date for expressions of interest
Notification of outcome of EoIs
Invitation to tender issued
Closing date for tenders
Notification of outcome of tender review
Project start date
Project end date
Noon Monday 8 October 2012
by Monday 15 October
Thursday 18 October 2012
Monday 5 November 2012
Friday 16 November 2012
by end November 2012
31 March 2013
A final draft is required by Friday 15 March 2013, and the research and report
need to be completed by 31 March 2013.
Requirements
We would welcome expressions of interest from individuals or organisations,
outlining their suitably for the project in no more than 750 words by noon
on Monday 8 October 2012.
Expressions of interest will be assessed using the following criteria, listed in
order of importance:
1. Knowledge and experience of the relevant methodologies for
estimating this sort of association
2. Knowledge of the relevant data sources
3. Knowledge of the relevant literature
4. Knowledge of the HE policy background.
2
Your expression of interest should be emailed as an attachment in Word
format to [email protected] Please also submit any queries to this
address.
3