Workers' Education Spatial Convergence: Evidence from Brazilian Regions

In recent decades, Brazil has experienced two simultaneous structural shifts: the decentralization of its manufacturing sector from traditional hubs in the Southeast to other regions, and a significant expansion in access to education. These changes raise important questions about whether industrial human capital, particularly educational outcomes, has become more evenly distributed across space. This research investigates spatial convergence in the average years of schooling of manufacturing workers across Brazilian regions between 2003 and 2019. Using regional labor market data and spatial econometric techniques, we test both β- and σ-convergence hypotheses applied to average years of schooling in the manufacturing sector. Results suggest a statistically significant process of convergence, with lagging regions gradually catching up to more educated ones. Spatial autocorrelation tests indicate a non-random geographic pattern, reinforcing the role of spatial spillovers in shaping human capital distribution. The findings highlight the importance of regional industrial dynamics and educational policies in reducing human capital disparities within the country. This study contributes to the literature by offering novel evidence from a large developing economy, combining sector-specific focus with spatial convergence analysis. JEL Codes: J24, R11, R12, C23