Advertisement

Beyond balanced growth: The effect of human capital on economic growth reconsidered

  • Uwe Sunde
  • Thomas Vischer
Part of the Management for Professionals book series (MANAGPROF)

Abstract

Human capital plays a central role in theoretical models of endogenous growth. Nevertheless, the existing empirical evidence on human capital’s effect on economic growth is mixed. Part of this weak evidence might be the result of overly restrictive specifications of the estimated empirical growth models. A more flexible estimation framework’s results reveal that human capital does indeed have a strong positive effect on economic growth, but this effect differs substantially across countries. In particular, the evidence suggests that human capital has a stronger effect in countries in which the population faces favorable living conditions in terms of life expectancy and geographic characteristics, while the effects do not differ substantially between countries that differ with regard to their political institutions’ quality.

Keywords

Human Capital Physical Capital Growth Effect Institutional Quality Balance Growth 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

References

  1. Acemoglu, D., Johnson, S., J. Robinson, & Yared P. (2008). Income and Democracy. American Economic Review, 98(3), 808–842.CrossRefGoogle Scholar
  2. Barro, R.J., & Lee, J.W. (2010). A New Data Set of Education Attainment in the World,1950–2010. NBER Working Paper, 15902.Google Scholar
  3. Benhabib, J., & Spiegel, M. (1994). The role of human capital in economic development:Evidence from aggregate cross-country data. Journal of Monetary Economics, 34(1),143–173.CrossRefGoogle Scholar
  4. Mankiw, G.N., Romer, P., & Weil, D. (1992). A Contribution to the Empirics of EconomicGrowth. Quarterly Journal of Economics, 107, 407–437.CrossRefGoogle Scholar
  5. Owen, A.L., Videras, J., & Davis, L. (2009). Do all countries follow the same growthprocess?. Journal of Economic Growth, 14(4), 265–286.CrossRefGoogle Scholar
  6. Sunde, U., & Vischer, T. (2011). Human Capital and Growth: Specification Matters. Universityof St.Gallen, Dept. of Economics Discussion Paper No. 2011–31. Google Scholar
  7. Temple, J. (2008). “Balanced Growth”. The New Palgrave Dictionary of Economics. SecondEdition. Eds. Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008.Google Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2012

Authors and Affiliations

  • Uwe Sunde
    • 1
  • Thomas Vischer
    • 1
  1. 1.University of St.GallenSt.GallenSwitzerland

Personalised recommendations