Human capital, externalities and growth in an overlapping generations model
AbstractWe consider an overlapping generations model with endogenous labor supplies by young and old and a human capital accumulation process that relies on the interaction of these two types of labor. This interaction is not understood by the market hence we analyze fiscal policies designed to remedy this. We argue that taxes must be acceptable to people alive at the time of planning. This makes many proposed taxes unfeasible. Two distinct paths to growth emerge; one through increased savings and another through increased workforce participation. The long run rate of growth depends entirely on human capital but we find this to be of little relevance. Some simulation results are presented for two stylized economic blocks calibrated on the USA and the EURO-zone.
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Bibliographic InfoArticle provided by Elsevier in its journal Research in Economics.
Volume (Year): 64 (2010)
Issue (Month): 3 (September)
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Web page: http://www.elsevier.com/locate/inca/622941
Overlapping generations model Endogenous labor supply Learning-by-doing Human capital;
Other versions of this item:
- Gaumont D. & Leonard D., 2005. "Human Capital, Externalities and Growth in an Overlapping Generation Model," Working Papers ERMES 0513, ERMES, University Paris 2.
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