Heterogeneous Human Capital, Trade and Growth
AbstractDistribution differences in human capital matter for a country’s growth and trade. While the existing literature considers only the diversity difference in talent distribution, we argue that the kurtosis difference is also an important factor. In a two-sector equilibrium growth model, where the production function is supermodular for the consumption-good sector and submodular for the R&D sector, we prove that the diversity effect and kurtosis effect are opposite to each other. A country endowed with more diverse but leptokurtic talent distribution may have lower growth rate and import submodular goods, opposite to the conventional result from considering only the diversity difference.
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Bibliographic InfoPaper provided by Institute of Economics, Academia Sinica, Taipei, Taiwan in its series IEAS Working Paper : academic research with number 11-A004.
Length: 15 pages
Date of creation: Apr 2011
Date of revision:
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Web page: http://www.econ.sinica.edu.tw/index.php?foreLang=en
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diversity; kurtosis; growth; trade;
Find related papers by JEL classification:
- F11 - International Economics - - Trade - - - Neoclassical Models of Trade
- 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-2011-04-30 (All new papers)
- NEP-FDG-2011-04-30 (Financial Development & Growth)
- NEP-HRM-2011-04-30 (Human Capital & Human Resource Management)
- NEP-INT-2011-04-30 (International Trade)
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