Regional clustering of human capital: school grades and migration of university graduates

Abstract

The spatial distribution of human capital plays a fundamental role for regional differences in economic growth and welfare. This paper examines how individual ability indicated by the grade point average (GPA) from comprehensive school affects the probability of migration among young university graduates in Sweden. Using detailed microdata available from the Swedish population register, the study examines two cohorts of individuals who enrol in tertiary education. The results indicate that individual abilities reflected by the GPA are strongly influential when it comes to completing a university degree and for the migration decision after graduation. Moreover, there is a positive relationship between the GPA and the choice of migrating from regions with a relatively low tax base and a relatively small share of highly educated people in the population, while individuals with higher GPA tend to stay at a higher rate in more flourishing regions.