Intergenerational Complementarities in Education and the Relationship between Growth and Volatility
AbstractWe construct an overlapping generations model in which parents vote on the tax rate that determines publicly provided education and offspring choose their effort in learning activities. The technology governing the accumulation of human capital allows these decisions to be strategic complements. In the presence of coordination failure, indeterminacy and, possibly, growth cycles emerge. In the absence of coordination failure, the economy moves along a uniquely determined balanced growth path. We argue that such structural differences can account for the negative correlation between volatility and growth.
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Bibliographic InfoPaper provided by Department of Economics, University of Macedonia in its series Discussion Paper Series with number 2009_05.
Date of creation: Mar 2009
Date of revision: Mar 2009
Human Capital; Economic Growth; Volatility.;
Other versions of this item:
- Theodore Palivos & Dimitrios Varvarigos, 2009. "Intergenerational Complementarities in Education and the Relationship between Growth and Volatility," Discussion Papers in Economics 09/8, Department of Economics, University of Leicester.
- O41 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-03-22 (All new papers)
- NEP-DGE-2009-03-22 (Dynamic General Equilibrium)
- NEP-EDU-2009-03-22 (Education)
- NEP-FDG-2009-03-22 (Financial Development & Growth)
- NEP-HRM-2009-03-22 (Human Capital & Human Resource Management)
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- Theodore Palivos & Dimitrios Varvarigos, 2013.
"Intergenerational Complementarities in Education, Endogenous Public Policy, and the Relation Between Growth and Volatility,"
Journal of Public Economic Theory,
Association for Public Economic Theory, vol. 15(2), pages 249-272, 04.
- Palivos, Theodore & Varvarigos, Dimitrios, 2011. "Intergenerational complementarities in education, endogenous public policy, and the relation between growth and volatility," MPRA Paper 31343, University Library of Munich, Germany.
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