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Availability of Higher Education and Long-Term Economic Growth

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  • Ryo Horii

    ()
    (Graduate School of Economics, Osaka University)

  • Akiomi Kitagawa

    (Graduate School of Economics and Management, Tohoku University)

  • Koichi Futagami

    (Graduate School of Economics, Osaka University)

Abstract

This paper examines the economic growth effects of limited availability of higher education in a simple endogenous growth model with overlapping generations. With limited availability, the scarcity of human capital keeps its price high and distributes a larger share of the aggregate output to young households. Under certain conditions, it leads to greater aggregate savings in each period, thereby enabling the economy to grow faster than without any limitation. In such cases, an excessive expansion in the availability causes a temporary boom followed by a serious deficiency in investible funds, resulting in a substantial slowdown in economic growth.

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File URL: http://www2.econ.osaka-u.ac.jp/library/global/dp/0314R.pdf
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Bibliographic Info

Paper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 03-14-Rev.

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Length: 39 pages
Date of creation: Nov 2003
Date of revision: Sep 2005
Handle: RePEc:osk:wpaper:0314r

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Web page: http://www.econ.osaka-u.ac.jp/
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Keywords: Endogenous Growth; Human Capital; Slowdown; Intergenerational Income Distribution.;

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References

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Citations

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Cited by:
  1. repec:ebl:ecbull:v:15:y:2004:i:2:p:1-6 is not listed on IDEAS
  2. Aziz, Babar & Khan, Tasneem & Aziz, Shumaila, 2008. "Impact of Higher Education on Economic Growth of Pakistan," MPRA Paper 22912, University Library of Munich, Germany, revised 2008.
  3. Akiomi Kitagawa & Ryo Horii & Koichi Futagami, 2004. "Who Benefits from a Better Education Environment?," Discussion Papers in Economics and Business 04-15, Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP).
  4. Ryo Horii & Koichi Futagami & Akiomi Kitagawa, 2004. "Investment efficiency and intergenerational income distribution: a paradoxical result," Economics Bulletin, AccessEcon, vol. 15(2), pages 1-6.

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