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Education and Health: Evidence of Threshold Effects on Economic Growth

Author

Listed:
  • Pablo Daniel Monterubbianesi

    (Universidad Nacional del Sur)

  • Mara Leticia Rojas

    (Universidad Nacional del Sur)

  • Carlos Darío Dabús

    (Universidad Nacional del Sur)

Abstract

This work analyzes the effect of education and health on economic growth using a fixed-effect panel threshold model for 86 economies from 1960 to 2010. In accordance with non-linearities literature, the work verifies the existence of two income thresholds, after which health and education affect growth differently. Although the magnitude of the effect of health on economic growth is variable, the relationship between them is always positive. Nonetheless, education has only a positive effect on growth after the second income threshold. The intuition is that a healthier population implies a better economic performance, regardless of the development stage. Differently, a higher education should have favorable effects only from a minimal level of income compatible with a minimal physical capital.

Suggested Citation

  • Pablo Daniel Monterubbianesi & Mara Leticia Rojas & Carlos Darío Dabús, 2021. "Education and Health: Evidence of Threshold Effects on Economic Growth," Lecturas de Economía, Universidad de Antioquia, Departamento de Economía, issue 94, pages 195-231, Enero-Jun.
    • Handle: RePEc:lde:journl:y:2021:i:94:p:195-231
    DOI: 10.17533/udea.le.n94a342459
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    References listed on IDEAS

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    2. Paul Johnson & Chris Papageorgiou, 2020. "What Remains of Cross-Country Convergence?," Journal of Economic Literature, American Economic Association, vol. 58(1), pages 129-175, March.
    3. Costas Azariadis & Allan Drazen, 1990. "Threshold Externalities in Economic Development," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 105(2), pages 501-526.
    4. Andros Kourtellos, 2011. "Modeling parameter heterogeneity in cross-country regression models," University of Cyprus Working Papers in Economics 11-2011, University of Cyprus Department of Economics.
    5. Romer, Paul M., 1990. "Human capital and growth: Theory and evidence," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 32(1), pages 251-286, January.
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    More about this item

    Keywords

    education; health; growth; threshold effects; panel data;
    All these keywords.

    JEL classification:

    • C1 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • O5 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies

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