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More on the estimation of the human capital depreciation rate

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  • Maria Arrazola
  • Jose de Hevia

Abstract

This study formulates an alternative empirical model to that of Groot (Applied Economics Letters, 5, 535-8, 1998) to estimate the rate of depreciation of human capital, in which the post-schooling investment and the difference between the potential and the observed earnings of the individuals are taken into account. As an illustration, the model has been estimated for a sample of Spanish men and women. The results show depreciation rates of human capital of around 1-1.5% per year.

Suggested Citation

  • Maria Arrazola & Jose de Hevia, 2004. "More on the estimation of the human capital depreciation rate," Applied Economics Letters, Taylor & Francis Journals, vol. 11(3), pages 145-148.
    • Handle: RePEc:taf:apeclt:v:11:y:2004:i:3:p:145-148
    DOI: 10.1080/1350485042000203742
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    References listed on IDEAS

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    1. Jacob Mincer & Solomon Polachek, 1974. "Family Investments in Human Capital: Earnings of Women," NBER Chapters, in: Marriage, Family, Human Capital, and Fertility, pages 76-110, National Bureau of Economic Research, Inc.
    2. O. Ashenfelter & D. Card (ed.), 1999. "Handbook of Labor Economics," Handbook of Labor Economics, Elsevier, edition 1, volume 3, number 3.
    3. Jacob A. Mincer, 1974. "Schooling and Earnings," NBER Chapters, in: Schooling, Experience, and Earnings, pages 41-63, National Bureau of Economic Research, Inc.
    4. Jacob A. Mincer, 1974. "Schooling, Experience, and Earnings," NBER Books, National Bureau of Economic Research, Inc, number minc74-1, January.
    5. James W. Albrecht & Per-Anders Edin & Marianne Sundström & Susan B. Vroman, 1999. "Career Interruptions and Subsequent Earnings: A Reexamination Using Swedish Data," Journal of Human Resources, University of Wisconsin Press, vol. 34(2), pages 294-311.
    6. Jacob Mincer & Haim Ofek, 1982. "Interrupted Work Careers: Depreciation and Restoration of Human Capital," Journal of Human Resources, University of Wisconsin Press, vol. 17(1), pages 3-24.
    7. Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863, Elsevier.
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