Hostname: page-component-74656f9884-2dmjx Total loading time: 0 Render date: 2026-11-09T12:25:18.567Z Has data issue: false hasContentIssue false
  • English
  • Français

HUMAN CAPITAL, AGGREGATION, AND GROWTH

Published online by Cambridge University Press:  04 March 2010

Jakub Growiec
Jakub Growiec*
Affiliation:
Warsaw School of Economics
*
Address correspondence to: Jakub Growiec, Institute of Econometrics, Warsaw School of Economics. Al. Niepodleglości 162, 02-554 Warsaw, Poland; e-mail: jakub.growiec@sgh.waw.pl.
Rights & Permissions [Opens in a new window]

Abstract

Core share and HTML view are not available for this content. However, as you have access to this content, a full PDF is available via the 'Save PDF' action button.

Human capital is embodied in people of different generations whose lifetimes are finite. We show that the finiteness of people's lives precludes human capital accumulation from driving long-run aggregate economic growth unless sufficiently strong externalities from aggregate human capital are introduced. Two possible channels for carrying forward such externalities are (i) knowledge spillovers and (ii) public education spending. Our findings shed new light on the foundations of the Uzawa–Lucas growth model. We also show that the cross-sectional Mincer equation, generated by a linear human capital accumulation equation at the individual level, does not carry forward to aggregate data.

Keywords

Human Capital AccumulationAggregation across VintagesExternalitiesBalanced Growth

Information

Type
Articles
Information
Macroeconomic Dynamics , Volume 14 , Issue 2 , April 2010 , pp. 189 - 211
Copyright
Copyright © Cambridge University Press 2010

References

REFERENCES

Acemoglu, Daron and Angrist, Joshua (2001) How large are human capital externalities? Evidence from compulsory schooling laws. In Bernanke, Ben S. and Rogoff, Kenneth (eds.), NBER Macroeconomics Annual 2000, pp. 9–58. Cambridge, MA: MIT Press.Google Scholar
Arias, Omar and McMahon, Walter W. (2001) Dynamic rates of return to education in the U.S. Economics of Education Review 20, 121–138.CrossRefGoogle Scholar
Azomahou, Théophile T., Boucekkine, Raouf, and Diene, Bity (in press) A closer look at the relationship between life expectancy and economic growth. International Journal of Economic Theory.Google Scholar
Barro, Robert J. and Sala-i-Martin, Xavier X. (1995) Economic Growth. New York: McGraw-Hill.Google Scholar
Becker, Gary S. and Tomes, Nigel (1986) Human capital and the rise and fall of families. Journal of Labor Economics 4, S1–S39.CrossRefGoogle ScholarPubMed
Belzil, Christian and Hansen, Jörgen (2002) Unobserved ability and the return to schooling. Econometrica 70 (5), 2075–2091.CrossRefGoogle Scholar
Bénabou, Roland (1996) Heterogeneity, stratification, and growth: Macroeconomic implications of community structure and school finance. American Economic Review 86 (3), 584–609.Google Scholar
Ben-Porath, Yoram (1967) The production of human capital and the life cycle of earnings. Journal of Political Economy 75, 352–365.CrossRefGoogle Scholar
Bils, Mark and Klenow, Peter J. (2000) Does schooling cause growth? American Economic Review 90 (5), 1160–1183.CrossRefGoogle Scholar
Blanchard, Olivier (1985) Debt, deficits, and finite horizons. Journal of Political Economy 93, 223–247.CrossRefGoogle Scholar
Bloom, David E., Canning, David, and Sevilla, Jaypee (2004) The effect of health on economic growth: A production function approach. World Development 32 (1), 1–13.CrossRefGoogle Scholar
Borjas, George J. (1995) Ethnicity, neighborhoods, and human-capital externalities. American Economic Review 85, 365–390.Google Scholar
Boucekkine, Raouf, de la Croix, David, and Licandro, Omar (2002) Vintage human capital, demographic trends and endogenous growth. Journal of Economic Theory 104, 340–375.CrossRefGoogle Scholar
Boucekkine, Raouf, de la Croix, David, and Licandro, Omar (2003) Early mortality declines at the dawn of modern growth. Scandinavian Journal of Economics 105, 401–418.CrossRefGoogle Scholar
Card, David E. (1999) The causal effect of education on earnings. In Ashenfelter, Orley and Card, David E. (eds.) Handbook of Labor Economics Vol. 3, pp. 1801–1863. Amsterdam: Elsevier.CrossRefGoogle Scholar
Davies, James B. (2003) Empirical Evidence on Human Capital Externalities. RBC Financial Group Economic Policy Research Institute Working Paper 20035, University of Western Ontario.Google Scholar
de la Croix, David and Doepke, Matthias (2003) Inequality and growth: Why differential fertility matters. American Economic Review 93, 1091–1113.CrossRefGoogle Scholar
Faruqee, Hamid (2003) Debt, deficits, and age-specific mortality. Review of Economic Dynamics 6, 300–312.CrossRefGoogle Scholar
Galor, Oded and Tsiddon, Daniel (1997) The distribution of human capital and economic growth. Journal of Economic Growth 2, 93–124.CrossRefGoogle Scholar
Gong, Gang, Greiner, Alfred, and Semmler, Willi (2004) The Uzawa-Lucas model without scale effects: Theory and empirical evidence. Structural Change and Economic Dynamics 15, 401–420.CrossRefGoogle Scholar
Growiec, Jakub (2007) Human Capital, Aggregation, and Growth. CORE Discussion Paper 2007/56.CrossRefGoogle Scholar
Heckman, James J., Lochner, Lance J., and Todd, Petra E. (2003) Fifty Years of Mincer Earnings Regressions. NBER Working Paper 9732.CrossRefGoogle Scholar
Jones, Charles I. (2005) Growth and ideas. In Aghion, Philippe and Durlauf, Steven N. (eds.), Handbook of Economic Growth, pp. 1063–1111. Amsterdam: North-Holland.Google Scholar
Jones, Larry E. and Manuelli, Rodolfo E. (1992) Finite lifetimes and growth. Journal of Economic Theory 58 (2), 171–197.CrossRefGoogle Scholar
Krueger, Alan B. and Lindahl, Mikael (2001) Education for growth. Why and for whom? Journal of Economic Literature 39 (4), 1101–1136.CrossRefGoogle Scholar
Lucas, Robert E. (1988) On the mechanics of economic development. Journal of Monetary Economics 22 (1), 3–42.CrossRefGoogle Scholar
Lucas, Robert E. (1993) Making a miracle. Econometrica 61 (2), 251–272.CrossRefGoogle Scholar
Manuelli, Rodolfo E. and Seshadri, Ananth (2005) Human Capital and the Wealth of Nations. Mimeo, University of Wisconsin–Madison.Google Scholar
Mincer, Jacob (1974) Schooling, Experience, and Earnings. New York: Columbia University Press.Google Scholar
Pandey, Manish (2008) Human capital aggregation and relative wages across countries. Journal of Macroeconomics 30 (4), 1587–1601.CrossRefGoogle Scholar
Rangazas, Peter C. (2000) Schooling and economic growth: A King–Rebelo experiment with human capital. Journal of Monetary Economics 46, 397–416.CrossRefGoogle Scholar
Rangazas, Peter C. (2005) Human capital and growth: An alternative accounting. Topics in Macroeconomics 5 (1), Art. 20.CrossRefGoogle Scholar
Rebelo, Sergio T. (1991) Long-run policy analysis and long-run growth. Journal of Political Economy 99 (3), 500–521.CrossRefGoogle Scholar
Tamura, Robert F. (2001) Teachers, growth, and convergence. Journal of Political Economy 109 (5), 1021–1059.CrossRefGoogle Scholar
Uzawa, Hirofumi (1965) Optimum technical change in an aggregative model of economic growth. International Economic Review 6, 18–31.CrossRefGoogle Scholar