The role of educational quality and quantity in the process of economic development
Amparo Castello-Climent () and
Ana Hidalgo-Cabrillana ()
Economics of Education Review, 2012, vol. 31, issue 4, 391-409
We develop a theory of human capital investment to study the effects of school quality on student choices of education, and to understand its effect on economic growth. In a dynamic general equilibrium closed economy, primary education is mandatory but there is an opportunity to continue to secondary education and beyond. High-quality education increases the returns to schooling, and hence the incentives to accumulate human capital. This is caused by two different channels: higher quality makes education accessible to more people (extensive margin), and once individuals decide to participate in higher education, higher-quality increases the investment made per individual (intensive margin). Furthermore, educational quality determines human capital composition and growth. Cross-country data evidence shows that the proposed channels are quantitatively important and that the effect of the quality and quantity of education on growth depends on the stage of development.
Keywords: Quality of education; Human capital composition; Economic growth (search for similar items in EconPapers)
JEL-codes: I21 O11 O15 O4 (search for similar items in EconPapers)
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Working Paper: The Role of Educational Quality and Quantity in the Process of Economic Development (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecoedu:v:31:y:2012:i:4:p:391-409
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