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Social Stratification, Capital Skill Complementarity, And The Nonmonotonic Evolution Of The Education Premium

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  • MAOZ, YISHAY D.
  • MOAV, OMER

Abstract

This paper presents a model that generates a nonmonotonic evolution of the return to education. The model highlights the role played by socioeconomic stratification in the joint determination of the supply of educated labor and the supply of physical capital. The recent theoretical literature attributes the increased education premium of the last decades to skill-biased technological progress. In contrast, our explanation is based on capital skill complementarity and endogenous accumulation of physical and human capital in an environment characterized by credit constraints.

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Bibliographic Info

Article provided by Cambridge University Press in its journal Macroeconomic Dynamics.

Volume (Year): 8 (2004)
Issue (Month): 03 (June)
Pages: 295-309

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Handle: RePEc:cup:macdyn:v:8:y:2004:i:03:p:295-309_03

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Cited by:
  1. Konstantinos Angelopoulos & Jim Malley & Apostolis Philippopoulos, 2013. "Human Capital, Social Mobility and the Skill Premium," CESifo Working Paper Series 4388, CESifo Group Munich.
  2. Sylvain Dessy & Flaubert Mbiekop & Stéphane Pallage, 2005. "On the Mechanics of Trade-Induced Structural Transformation," Cahiers de recherche 0529, CIRPEE.
  3. Hideki Nakamura, 2013. "Wages of regular and irregular workers, the price of education, and income inequality," Journal of Economic Inequality, Springer, vol. 11(4), pages 517-533, December.
  4. Afonso, Óscar & Thompson, Maria, 2011. "Costly investment, complementarities and the skill premium," Economic Modelling, Elsevier, vol. 28(5), pages 2254-2262, September.
  5. Afonso, Oscar, 2013. "Diffusion and directed technological knowledge, human capital and wages," Economic Modelling, Elsevier, vol. 31(C), pages 370-382.

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