IDEAS home Printed from https://ideas.repec.org/a/eee/ecmode/v49y2015icp308-313.html
   My bibliography  Save this article

Economic growth and the harmful effects of student loan debt on biomedical research

Author

Listed:
  • Ferretti, Fabrizio
  • Jones, Simon
  • McIntosh, Bryan

Abstract

Modern theories of economic growth emphasise the key role of human capital and technological progress in determining a society's standard of living. In some advanced countries, however, higher education costs and the level of indebtedness among graduates have increased dramatically during recent years. This phenomenon is particularly evident in the United States, and within the biomedical sciences sector. In this paper, we develop a basic model of economic growth in order to investigate the effects of biomedical graduate indebtedness on the allocation of human resources in R&D activities and hence on the growth process. In particular, we derive a ‘science–growth curve’, i.e., a relation between the share of pure researchers and the economy's rate of growth, and we find two possible effects of student indebtedness on economic growth: a composition effect and a productivity effect.

Suggested Citation

  • Ferretti, Fabrizio & Jones, Simon & McIntosh, Bryan, 2015. "Economic growth and the harmful effects of student loan debt on biomedical research," Economic Modelling, Elsevier, vol. 49(C), pages 308-313.
    • Handle: RePEc:eee:ecmode:v:49:y:2015:i:c:p:308-313
    DOI: 10.1016/j.econmod.2015.05.004
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0264999315001212
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.econmod.2015.05.004?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 70(1), pages 65-94.
    2. Mincer, Jacob, 1984. "Human capital and economic growth," Economics of Education Review, Elsevier, vol. 3(3), pages 195-205, June.
    3. Kevin M. Murphy & Andrei Shleifer & Robert W. Vishny, 1991. "The Allocation of Talent: Implications for Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(2), pages 503-530.
    4. Robert J. Barro, 1991. "Economic Growth in a Cross Section of Countries," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 106(2), pages 407-443.
    5. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 407-437.
    6. Catherine M. Millett, 2003. "How Undergraduate Loan Debt Affects Application and Enrollment in Graduate or First Professional School," The Journal of Higher Education, Taylor & Francis Journals, vol. 74(4), pages 386-427, July.
    7. Rothstein, Jesse & Rouse, Cecilia Elena, 2011. "Constrained after college: Student loans and early-career occupational choices," Journal of Public Economics, Elsevier, vol. 95(1), pages 149-163.
    8. repec:fip:fedpbr:y:2013:i:q3:p:1-10:n:96 is not listed on IDEAS
    9. Erica Field, 2009. "Educational Debt Burden and Career Choice: Evidence from a Financial Aid Experiment at NYU Law School," American Economic Journal: Applied Economics, American Economic Association, vol. 1(1), pages 1-21, January.
    10. J. Vernon Henderson & Adam Storeygard & David N. Weil, 2012. "Measuring Economic Growth from Outer Space," American Economic Review, American Economic Association, vol. 102(2), pages 994-1028, April.
    11. Bazzoli, Gloria J., 1985. "Does educational indebtedness affect physician specialty choice?," Journal of Health Economics, Elsevier, vol. 4(1), pages 1-19, March.
    12. Wenli Li, 2013. "The economics of student loan borrowing and repayment," Business Review, Federal Reserve Bank of Philadelphia, issue Q3, pages 1-10.
    13. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Durlauf, Steven N. & Quah, Danny T., 1999. "The new empirics of economic growth," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 4, pages 235-308, Elsevier.
    2. Silves J.C. Moreira & Pedro Cosme Vieira & Aurora A.C. Teixeira, 2014. "Estimating the human capital stock for Cape Verde, 1950-2012," FEP Working Papers 547, Universidade do Porto, Faculdade de Economia do Porto.
    3. Jean-Luc Demeulemeester & Claude Diebolt, 2011. "Education and Growth: What Links for Which Policy?," Historical Social Research (Section 'Cliometrics'), Association Française de Cliométrie (AFC), vol. 36(4), pages 323-346.
    4. Jones, C.I., 2016. "The Facts of Economic Growth," Handbook of Macroeconomics, in: J. B. Taylor & Harald Uhlig (ed.), Handbook of Macroeconomics, edition 1, volume 2, chapter 0, pages 3-69, Elsevier.
    5. Celine Kauffmann, 2000. "The interactive effect of trade and education on growth," Post-Print halshs-03721622, HAL.
    6. Levine, Ross & Renelt, David, 1991. "Cross-country studies of growth and policy : methodological, conceptual, and statistical problems," Policy Research Working Paper Series 608, The World Bank.
    7. Jean Luc De Meulemeester, 2007. "L'économie de l'éducation fait-elle des progrès? Une perspective d'histoire de la pensée économique," Brussels Economic Review, ULB -- Universite Libre de Bruxelles, vol. 50(1), pages 89-111.
    8. Sbaouelgi, Jihène, 2015. "L’impact de l’Enseignement Supérieur sur la Croissance Economique L'Impact de l'Enseignement Supérieur sur la Croissance Economique Cas de la Tunisie, le Maroc et la Corée du Sud [The Impact of Hig," MPRA Paper 66980, University Library of Munich, Germany.
    9. Sefa Awaworyi Churchill & Mehmet Ugur & Siew Ling Yew, 2017. "Does Government Size Affect Per-Capita Income Growth? A Hierarchical Meta-Regression Analysis," The Economic Record, The Economic Society of Australia, vol. 93(300), pages 142-171, March.
    10. Nicola Gennaioli & Rafael La Porta & Florencio Lopez-de-Silanes & Andrei Shleifer, 2013. "Human Capital and Regional Development," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 128(1), pages 105-164.
    11. Mo, Pak Hung, 2011. "Institutions, Entrepreneurship and Channels to Sustained Economic Growth," MPRA Paper 28911, University Library of Munich, Germany.
    12. Gregory Mankiw, 1995. "The Growth of Nations," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1, 25th A), pages 275-326.
    13. Amavilah, Voxi Heinrich, 2014. "Knowledge = Technology + Human Capital and the Lucas and Romer Production Functions," MPRA Paper 58847, University Library of Munich, Germany.
    14. Céline Kauffmann, 2000. "The interactive effect of trade and education on growth," Cahiers de la Maison des Sciences Economiques bla00022, Université Panthéon-Sorbonne (Paris 1).
    15. Charles I. Jones, 2019. "Paul Romer: Ideas, Nonrivalry, and Endogenous Growth," Scandinavian Journal of Economics, Wiley Blackwell, vol. 121(3), pages 859-883, July.
    16. Celine Kauffmann, 2000. "The interactive effect of trade and education on growth," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-03721622, HAL.
    17. Amavilah, Voxi Heinrich, 2014. "Human Knowledge and a Commonsensical Measure of Human Capital: A Proposal," MPRA Paper 57670, University Library of Munich, Germany.
    18. van de Klundert, T.C.M.J. & Smulders, J.A., 1991. "Reconstructing growth theory : A survey," Other publications TiSEM 19355c51-17eb-4d5d-aa66-b, Tilburg University, School of Economics and Management.
    19. Olusanya, Oluwakorede, 2016. "Causality between Human Resource Development and the Nigerian Economic Performance," MPRA Paper 100854, University Library of Munich, Germany.
    20. Asongu, Simplice & Amavilah, Voxi & Andrés, Antonio R., 2014. "Economic Implications of Business Dynamics for KE-Associated Economic Growth and Inclusive Development in African Countries," MPRA Paper 63793, University Library of Munich, Germany.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecmode:v:49:y:2015:i:c:p:308-313. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/30411 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.