International TFP Dynamics and Human Capital Stocks: a Panel Data Analysis, 1960-2003

Adriana Di Liberto, Francesco Pigliaru and P. Chelucci

Working Paper CRENoS from Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia

Abstract: This paper adopts a fixed-effect panel methodology that enables us to take into account both TFP and neoclassical convergence. We use a sample of 76 countries, 1960-2003 and estimate TFP values obtained by using different estimators such as LSDV, Kiviet-corrected LSDV, and GMM à la Arellano and Bond. In our estimates, cross-country TFP dynamics shows that most countries in the sample do not catch up with the USA. We also find conditional convergence in TFP levels and that human capital acts as a robust enhancing factor of technology adoption, as suggested by Nelson and Phelps in 1966. In contrast with previous evidence, in our results even very low level of human capital stocks allow a country to enter a "conditional TFP convergence club" – a result again consistent with the original version of the Nelson-Phelps hypothesis. Further, our results imply a plausible link between stages of development and returns to different levels of education. Finally, the positive influence of human capital on technology catch up is robust to the inclusion of controls for a country's institutional quality.

Keywords: tfp; catching up; panel data; human capital (search for similar items in EconPapers)
JEL-codes: C23 O33 O47 (search for similar items in EconPapers)
Date: 2008
New Economics Papers: this item is included in nep-dev, nep-edu, nep-eff and nep-hrm
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: INTERNATIONAL TFP DYNAMICS AND HUMAN CAPITAL STOCKS: A PANEL DATA ANALYSIS, 1960–2003 (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:cns:cnscwp:200812

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