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Human capital and growth cycles
Leo Kaas and Stefan Zink
Vol. 31, No. 1 (April 2007), pp. 19-33
Published by: Springer
Stable URL: http://www.jstor.org/stable/27822501
Page Count: 15
You can always find the topics here!Topics: Economic fluctuations, Human capital, Productivity growth, Parents, Economic growth models, Children, Economic growth theories, Financial investments, Child growth, Growth capital
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This paper studies the dynamic interaction between human capital accumulation and economic growth. Capital market imperfections and an indivisibility in human capital investment prevent poor agents from accumulating skills, the acquisition of which positively affects technological progress. More productive technologies in turn require more sophisticated qualification and involve higher training costs. The equilibrium dynamics can be characterized by the joint evolution of productivity growth, the schooling costs, and the income distribution. Under our assumptions, individual incomes follow a non-linear Markov chain. This nonlinearity generates endogenous fluctuations of schooling activities and the rate at which productivity improvements occur.
Economic Theory © 2007 Springer