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On Some Undesirable Consequences of Education and Growth

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  • Pierre Cahuc
  • Fabien Postel-Vinay

Abstract

This paper presents a simple endogenous growth model with human capital accumulation in which competition in the educational system can lead to over-education, with rapid output growth and a simultaneous decline in welfare along a balance growth path in some circumstances. This illustrates the idea that satisfaction is not straightforwardly related to economic prosperity. Specifically, our model suggests that more elitist societies and societies with higher wage differentials may do better in terms of growth but worse in terms of welfare.

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Bibliographic Info

Article provided by Mohr Siebeck, Tübingen in its journal Journal of Institutional and Theoretical Economics.

Volume (Year): 156 (2000)
Issue (Month): 3 (September)
Pages: 445-

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Handle: RePEc:mhr:jinste:urn:sici:0932-4569(200009)156:3_445:osucoe_2.0.tx_2-5

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