The level and growth effects in the empirics of economic growth
AbstractMankiw, Romer and Weil (1992) have extended the Solow (1956) model by augmenting the production function with human capital. Its empirical success is impressive and it showed a procedure to improve the explanatory power of the neoclassical growth model. This paper suggests an empirical procedure to further extend the neoclassical growth model to distinguish between the growth and level effects of shift variables like the human capital. We use time series data from Guatemala to show that while the growth effects of education are small, they are significant and dominate the level effects.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 1841.
Date of creation: 20 Feb 2007
Date of revision:
Solow Growth Model; Production Function; Shift Variables; Human Capital Level and Growth Effects;
Find related papers by JEL classification:
- O15 - Economic Development, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
- O30 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - General
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
- O54 - Economic Development, Technological Change, and Growth - - Economywide Country Studies - - - Latin America; Caribbean
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-02-24 (All new papers)
- NEP-DEV-2007-02-24 (Development)
- NEP-HRM-2007-02-24 (Human Capital & Human Resource Management)
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