Are human and social capital linked? Evidence from India
Centre for Growth and Business Cycle Research Discussion Paper Series from Economics, The University of Manchester
This paper develops a two-period Overlapping Generations (OLG) model of endogenous growth in which a two-way relationship between social capital and human capital is studied. In order to illustrate the impact of public policies, the model is calibrated using the data for a low-income country, India and a sensitivity analysis is reported under different parameter configurations. Based on the numerical analysis, this paper focuses on possible trade-offs in the allocation of government spending between two productive components, that is, social capital-related activities and education. The results of this paper show that a higher share of spending on education promotes growth despite an offsetting cut in social capital-related activities; however, the reverse entails trade-offs. In other words, an increase in the share of spending on social capital-related activities through a concomitant cut in education is detrimental to long-run growth.
Pages: 30 pages
New Economics Papers: this item is included in nep-dge, nep-gro, nep-hrm and nep-soc
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Journal Article: Are Human and Social Capital Linked? Evidence from India (2017)
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Persistent link: https://EconPapers.repec.org/RePEc:man:cgbcrp:207
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