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Availability Of Higher Education And Long-Term Economic Growth

Author

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  • RYO HORII
  • AKIOMI KITAGAWA
  • KOICHI FUTAGAMI

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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Suggested Citation

  • Ryo Horii & Akiomi Kitagawa & Koichi Futagami, 2008. "Availability Of Higher Education And Long-Term Economic Growth," The Japanese Economic Review, Japanese Economic Association, vol. 59(2), pages 156-177.
  • Handle: RePEc:bla:jecrev:v:59:y:2008:i:2:p:156-177
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. 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.
    2. 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.
    3. repec:ebl:ecbull:v:15:y:2004:i:2:p:1-6 is not listed on IDEAS
    4. 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).
    5. Ganegodage, K. Renuka & Rambaldi, Alicia N., 2011. "The impact of education investment on Sri Lankan economic growth," Economics of Education Review, Elsevier, vol. 30(6), pages 1491-1502.

    More about this item

    JEL classification:

    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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