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Education and Health in an Effective-Labour Empirical Growth Model

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  • Knowles, Stephen
  • Owen, P Dorian

Abstract

A structural growth equation is formulated incorporating education and health as labor-augmenting variables in an aggregate production function. Although the model is an extension of the neoclassical framework, with diminishing returns to physical capital, growth rates in output per worker need not be identical across countries, even in their steady states. Cross-country empirical estimates suggest a strong positive relationship exists between growth and health (as proxied by life expectancy), even after allowing for possible simultaneity, consistent with other evidence on the productivity-enhancing effects of improved health status. By contrast, the relationship between output per worker and education is not significant. Copyright 1997 by The Economic Society of Australia.

Suggested Citation

  • Knowles, Stephen & Owen, P Dorian, 1997. "Education and Health in an Effective-Labour Empirical Growth Model," The Economic Record, The Economic Society of Australia, vol. 73(223), pages 314-328, December.
  • Handle: RePEc:bla:ecorec:v:73:y:1997:i:223:p:314-28
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