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Human capital and regional convergence in Canada

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  • Serge Coulombe
  • Jean-François Tremblay

Abstract

Proposes an empirical analysis of regional convergence in Canada based on the growth model of Barro et al. In an open economy with perfect capital mobility, if domestic residents cannot borrow abroad with human capital as collateral, the dynamics of human capital accumulation is the driving force of per capita income growth. Empirical results indicate that, as predicted by the theoretical model, various indicators of the stock of human capital did converge at the same speed as per capita income during the 1951-1996 period. A substantial part of the relative growth of per capita income indicators across Canadian provinces since the early 1950s could be explained by the convergence process of human capital indicators based on the percentage of the population, both sexes and males, who have at least a university degree. The estimates of the human capital share in national income based on those indicators are in the neighbourhood of 0.5, a number consistent with other measures of the implicit income share of human capital. The convergence speed of per capita income at the regional level might have been two to three times faster, if all persons had invested in education at the same rate as the young.

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Bibliographic Info

Article provided by Emerald Group Publishing in its journal Journal of Economic Studies.

Volume (Year): 28 (2001)
Issue (Month): 3 (September)
Pages: 154-180

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Handle: RePEc:eme:jespps:v:28:y:2001:i:3:p:154-180

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Related research

Keywords: Convergence; Economicgrowth; Humancapital theory; Regional development;

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Cited by:
  1. Kufenko, Vadim, 2012. "Empirical analysis of regional economic performance in Russia: Human capital perspective," Violette Reihe Arbeitspapiere 38/2012, Promotionsschwerpunkt "Globalisierung und Beschaeftigung".
  2. Serge Coulombe & Jean-Francois Tremblay, 2009. "Education, Productivity and Economic Growth: A Selective Review of the Evidence," International Productivity Monitor, Centre for the Study of Living Standards, vol. 18, pages 3-24, Spring.
  3. Gabriel Rodríguez, 2006. "The role of the interprovincial transfers in the ß: Further empirical evidence for Canada," Journal of Economic Studies, Emerald Group Publishing, vol. 33(1), pages 12-29, January.
  4. Sadegh Bakhtiari & Hossein Meisami, 2010. "An empirical investigation of the effects of health and education on income distribution and poverty in Islamic countries," International Journal of Social Economics, Emerald Group Publishing, vol. 37(4), pages 293-301, March.
  5. Coulombe, S., 2000. "New Evidence of Convergence Across Canadian Provinces: the Role of Urbanization," Working Papers 0002e, University of Ottawa, Department of Economics.
  6. Norman Baldwin & Stephen Borrelli, 2008. "Education and economic growth in the United States: cross-national applications for an intra-national path analysis," Policy Sciences, Springer, vol. 41(3), pages 183-204, September.
  7. Steven Yamarik, 2011. "Human capital and state-level economic growth: what is the contribution of schooling?," The Annals of Regional Science, Springer, vol. 47(1), pages 195-211, August.
  8. Paudel, Krishna P. & Sambidi, Pramod R. & Sulgham, Anil K., 2004. "A Theoretical Development And Empirical Test On The Convergence Of Agricultural Productivity In The Usa," 2004 Annual meeting, August 1-4, Denver, CO 20175, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  9. Magrini, Stefano, 2004. "Regional (di)convergence," Handbook of Regional and Urban Economics, in: J. V. Henderson & J. F. Thisse (ed.), Handbook of Regional and Urban Economics, edition 1, volume 4, chapter 62, pages 2741-2796 Elsevier.
  10. Alasia, Alessandro, 2003. "Sub-Provincial Income Disparity in Canada: Evidence From 1992 to 1999," Agriculture and Rural Working Paper Series 28057, Statistics Canada.
  11. Kathleen M. Day & Stanley L. Winer, 2011. "What do we Know about the Relationship between Regionalized Aspects of the Unemployment Insurance System and Internal Migration in Canada?," CESifo Working Paper Series 3479, CESifo Group Munich.

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