Tight Labor Markets and the Demand for Education: Evidence from the Coal Boom and Bust

By D. Black, Terra McKinnish, Seth Sanders. 2005

200 citations recorded by the source corpus.

Human capital theory predicts that individuals acquire less schooling when the returns to schooling are small. To test this theory, the authors study the effect of the Appalachian coal boom on high school enrollments. During the 1970s, a boom in the coal industry increased the earnings of high school dropouts relative to those of graduates. During the 1980s, the boom subsided and the earnings of dropouts declined relative to those of graduates. The authors find that high school enrollment rates in Kentucky and Pennsylvania declined considerably in the 1970s and increased in the 1980s in coal-producing counties relative to counties without coal. The estimates indicate that a long-term 10% increase in the earnings of low-skilled workers could decrease high school enrollment rates by as much as 5–7%—a finding with implications for policies aimed at improving low-skilled workers' employment and earnings, such as wage subsidies and minimum wage increases.

Subfields: Economics and Econometrics, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/520c016e544f52c784e16cc40dfd13913cf5942e

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Citations in the corpus

Who Needs a Fracking Education? The Educational Response to Low-Skill-Biased Technological Change (2020, unknown): “…we focus on high school enrollment and dropout decisions of teenagers, similar to the prior literature on resource booms and busts EDUCATIONAL RESPONSE TO LOW-SKILL-BIASED TECHNOLOGICAL CHANGE 57 (Black, McKinnish, and Sanders 2005; Emery, Ferrer, and Green 2012; Morissette, Chan, and Lu 2015).”
Coal Mining, Economic Development, and the Natural Resource Curse (2015, background): “The coal boom of the 1970s and the bust of the 1980s identified by Black et al. (2005a) are apparent.”
Dutch Disease or Agglomeration? The Local Economic Effects of Natural Resource Booms in Modern America (2018, unknown): “This follows directly from applying the assumption that a resource boom increases Rhi wi to local sector labor demand in Equation (10).”
Family income and children's education: Using the Norwegian oil boom as a natural experiment (2010, methodology): “Since we do not have the data to account for the endogeniety of parental education we have to trust the results in Black et al. (2005), who present evidence against a causal relationship between parent and 12See Carneiro and Heckman (2002) for a discussion on IV estimations and credit constraints.”
Adaptation, culture, and the energy transition in American coal country (2018, background): “The allure of a low-skilled, high-paying profession often results in coal miners beginning their careers before completing high school [23,28].”
Coal Mining and the Resource Curse in the Eastern United States (2015, unknown): “Electronic copy available at: https://ssrn.com/abstract=2385560 Coal Mining and the Resource Curse in the Eastern United States”