We study the role of higher education on workers and firms by examining a national expansion of higher education in Vietnam, which established over 100 universities from 2006 to 201...
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We study the role of higher education on workers and firms by examining a national expansion of higher education in Vietnam, which established over 100 universities from 2006 to 2013. Collecting a dataset on the timing and location of university openings,
we estimate that individual’s exposure to a university opening increases their chances
of completing college by over 30%. It also raises their wage by 3.9% and household expenditure by 14%. At the market level, the expansion increases the relative supply of college-educated workers, thus reducing the college wage premium. In response, firms substitute non-college workers with skill-biased capital, allowing them to raise
productivity and hire more college-educated workers. We also find that opening a university in one district has substantial spatial spillover effects on to the labor market
of nearby districts