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Education, Sectoral Composition and Growth

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Author Info
Joseph K. Kaboski (Ohio State University)

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Abstract

Growth accounting exercises using standard human capital measures are limited in their ability to attribute causal effects and to explain growth. This paper develops a model of growth and schooling consistent with these decompositions but with less unexplained growth. The theory distinguishes between three different sources of education gains: (1) supply shifts, (2) skill-biased technical change increasing demand within industries/occupations, and (3) skill-biased technical change caused by the introduction of new skill-intensive industries/occupations. The third source leads to the large sectoral shifts and the largest growth effects. Quantitatively, schooling contributions account for 24 percent of wage growth, with both the direct (i.e., supply driven) causal contribution of schooling and the indirect causal (i.e., technology induced) contribution playing substantial roles. (Copyright: Elsevier)

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File URL: http://dx.doi.org/10.1016/j.red.2008.07.003
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Publisher Info
Article provided by Elsevier for the Society for Economic Dynamics in its journal Review of Economic Dynamics.

Volume (Year): 12 (2009)
Issue (Month): 1 (January)
Pages: 168-182
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Handle: RePEc:red:issued:06-133

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Related research
Keywords: Economic growth; Human capital; Structural transformation; Education;

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Find related papers by JEL classification:
O2 - Economic Development, Technological Change, and Growth - - Development Planning and Policy
O3 - Economic Development, Technological Change, and Growth - - Technological Change
I2 - Health, Education, and Welfare - - Education

References listed on IDEAS
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    Other versions:
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    Other versions:
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This page was last updated on 2009-11-24.

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