Labor productivity, age and education in Swedish mining and manufacturing 1985-1996

Thomas Lindh, Institute for Futures Studies
Björn Andersson, Central Bank of Sweden

We study the productivity effects of changes in education and age of the labor force in Swedish manufacturing over the eleven years 1985-1996. Our data allow us to examine the composition of the workforce with respect to demographics and education at each plant. Education and age correlate due to cohort effects since the younger workers have higher education. This makes identification of education effects precarious. We investigate this problem by conditioning on the age composition. The tentative and somwewhat surprising result is that tertiary education has less positive effects than secondary education in these industries.