Accounting for the International Quantity-Quality Trade-Off

Juan Cordoba, Xiying Liu and Marla Ripoll

No 2020-013, Working Papers from Human Capital and Economic Opportunity Working Group

Abstract: We investigate what accounts for the observed international differences in schooling and fertility, in particular the role of TFP, age-dependent mortality rates and public education policies. We use a generalized version of the Barro-Becker model that: (i) includes accumulation of human capital; (ii) allows for separate roles for intertemporal substitution, intergenerational substitution, and mortality risk aversion; and (iii) considers intergenerational financial frictions. We calibrate the model to a cross-section of countries in 2013. We find that while differences in TFP account for a large fraction of the dispersion in schooling, fertility and income per capita, public education subsidies play a major role. Public education spending per pupil matters relatively more in explaining the dispersion of fertility, while both the amount spent per pupil and the duration (years) of the subsidy are important in accounting for the dispersion of schooling. Eliminating public education subsidies results in an increase in average fertility, a decrease in human capital and income per capita, and an increase in the dispersion of schooling, fertility and income.

Keywords: public education subsidies; intergenerational financial frictions; fertility; mortality; schooling; parental altruism; TFP (search for similar items in EconPapers)
JEL-codes: I25 J13 O50 (search for similar items in EconPapers)
Date: 2020-03
New Economics Papers: this item is included in nep-dem and nep-dge
Note: M
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://humcap.uchicago.edu/RePEc/hka/wpaper/Cordob ... quantity-quality.pdf First version, March 2020 (application/pdf)

Related works:
Working Paper: Accounting for the International Quantity-Quality Trade-Off (2020)
Working Paper: Accounting for the International Quantity-Quality Trade-Off (2019)
Working Paper: Accounting for the International Quantity-Quality Trade-off (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hka:wpaper:2020-013

Access Statistics for this paper

More papers in Working Papers from Human Capital and Economic Opportunity Working Group Contact information at EDIRC.
Bibliographic data for series maintained by Jennifer Pachon ().