Micro Evidence on Human Capital as the Engine of Growth

Philip Trostel

No 269306, Economic Research Papers from University of Warwick - Department of Economics

Abstract: This study examines a crucial assumption in much of the recent work on endogenous growth, namely, constant returns to scale in the production of human capital. A simple model is constructed to show that the returns to scale in human capital production can be inferred from the relationship between the wage rate and years of schooling. A large international micro dataset is used to estimate this relationship. The empirical evidence is decisive. There are decreasing returns to scale in human capital production; that is, the micro-level evidence is not supportive of endogenous growth driven by human capital accumulation.

Keywords: Agricultural and Food Policy; Labor and Human Capital; Production Economics (search for similar items in EconPapers)
Pages: 32
Date: 2000-03-03
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Persistent link: https://EconPapers.repec.org/RePEc:ags:uwarer:269306

DOI: 10.22004/ag.econ.269306

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