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Brains and the city - Precis

Monthly Labor Review - October 1, 2003

The impact of a bachelor's degree on average individual economic outcomes has been quite well documented: Workers who have graduated from college are, on average, much less likely to be unemployed than are workers with less education and, when employed, have higher average earnings. Paul D. Gottlieb and Michael Fogarty, in a contribution to Economic Development Quarterly, ask if there are similar effects at the metropolitan area level of aggregation. They find that, at least at the extremes, there are.

In 1997, the most highly educated 10 metropolitan areas, as measured by the share of resident adults holding at least a bachelor's degree had a per capita income level about 20 percent higher than the average while the 10 metropolitan areas with the lowest proportions of the adult population holding college degrees had per capita incomes about 12 percent lower than the average. And, as has been the case in many studies of individual income, the gap had widened over time: in 1980 the most educated cities, according to Gottlieb and Fogarty, received a premium of about 12 percent and the least educated cities a penalty of only 3 percent.

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