Growth, distance to frontier and composition of human capital

Jérôme Vandenbussche, Philippe Aghion and Costas Meghir
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Jérôme Vandenbussche: Institute for Fiscal Studies

No W04/31, IFS Working Papers from Institute for Fiscal Studies

Abstract: We examine the contribution of human capital to economy-wide technological improvements through the two channels of innovation and imitation. We develop a theoretical model showing that skilled labor has a higher growth-enhancing effect closer to the technological frontier under the reasonable assumption that innovation is a relatively more skillintensive activity than imitation. Also, we provide evidence in favor of this prediction using a panel dataset covering 19 OECD countries between 1960 and 2000 and explain why previous empirical research had found no positive relationship between initial schooling level and subsequent growth in rich countries. In particular, we show that in OECD economies it is crucial to isolate the two separate margins of primary/secondary and tertiary education. Interestingly, the latter type of schooling proves to be a factor of economic divergence.

Pages: 51 pp.
Date: 2004-08-01
New Economics Papers: this item is included in nep-bec, nep-dev and nep-eff
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Citations: View citations in EconPapers (23)

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Related works:
Journal Article: Growth, distance to frontier and composition of human capital (2006)
Working Paper: Growth, distance to frontier and composition of human capital (2006)
Working Paper: Growth, Distance to Frontier and Composition of Human Capital (2005)
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