The European skill space: a cross-country analysis of path-dependent capability development

ABSTRACT

This study investigates the skill structures of European countries and their transformations from the perspective of capability development. The constructed skill space illustrates the skill sets of European nations based on product space methodology by linking skill occupation and occupation–country data from 2011 to 2018. The results show that there are remarkable differences in skill structures among countries, and there is a strong path dependence in skill development. The findings suggest that skill convergence is unlikely to occur and that skill inequality among countries requires serious consideration.

KEYWORDS:

• Skill structure
• human capital
• capability
• path dependence
• Europe

Disclosure statement

No potential conflict of interest was reported by the author(s).

Compliance with ethical standards

Data availability statements

The skill data that support the findings of this study are available from European Skills, Competences, Qualifications and Occupations (ESCO) database, https://ec.europa.eu/esco/portal/download, and EU Labour Force Survey (LFS) database https://ec.europa.eu/eurostat/web/lfs. Country-specific control variables are from Feenstra, Robert C., Robert Inklaar and Marcel P. Timmer (2015), ‘The Next Generation of the Penn World Table’ American Economic Review, 105(10), 3150–3182, available for download at www.ggdc.net/pwt.

Notes

1 Owing to data unavailability, Bulgaria, Malta, and Poland were excluded. The 3 EFTA countries are Iceland, Norway, and Switzerland.

2 For details on the methodology, please refer to European Commission (2021) Skills-Occupations Matrix Tables.

3 Eurostat (2021) provides a specific explanation on the sampling and non-sampling errors; these errors are calculated for each country and documented in the Quality Report of the European Union Labor Force Survey.

4 The yearly data used are based on the annual average of quarterly data. The use of population weights allows for the calculation of representative employment shares for each country.

5 The same occupation codes were used in ESCO to smooth the matching process.

6 For more information, see 2016 European Jobs Monitor report and Fernández-Macías and Bisello (2018). Same job, different tasks: Understanding the effects of technological changes on skills stands high at policy debates.

Additional information

Funding

This research was supported by the research funding granted by the University of Kitakyushu.

Notes on contributors

Sonja Walter

Sonja Walter is a postdoctoral researcher at the Korea Development Institute’s Graduate School of Public Policy and Management. Her main research area focuses on skills, capability and sustainable economic development.

Wonsub Eum

Wonsub Eum is an associate professor at the University of Kitakyushu. His research focuses on capability development, structural change and innovation.

Jeong-Dong Lee

Jeong-Dong Lee is a professor of the Interdisciplinary Graduate Program on Technology Management, Economics, and Policy at Seoul National University. His main research topics include firm dynamics, productivity and efficiency analysis, evolutionary economics, and economics of technological change.