On the Global Misallocation of Human Capital

Alexander Monge-Naranjo, Juan M. Sánchez and Raül Santaeulà lia-Llopis
Authors registered in the RePEc Author Service: Juan M. Sanchez and Raul Santaeulalia-Llopis ()

No 1037, Working Papers from Barcelona School of Economics

Abstract: Is human capital allocated efficiently across countries? To answer this question, we need to differentiate misallocation from factor intensity differences. We use newly available estimates on natural resources shares from Monge-Naranjo et al. (2017) to correctly measure the factor shares of physical and human capital for a large number of countries and periods. We find that the global efficiency losses of the misallocation of human capital are around 60% of the world's output. Moreover, the misallocation of human capital seems to have worsened in the more recent years. Interestingly, we show that when physical and human capital can both be reallocated, physical capital would often ow from poor to rich countries, contrary to Lucas (1990)'s paradox.

Keywords: human capital; migration; misallocation; natural rents; factor shares (search for similar items in EconPapers)
JEL-codes: O11 O16 O41 (search for similar items in EconPapers)
Date: 2018-04
New Economics Papers: this item is included in nep-int and nep-opm
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Persistent link: https://EconPapers.repec.org/RePEc:bge:wpaper:1037

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