Missing Markets for Human Capital and Differences in Growth
There are some empirical facts that growth models usually cannot explain: i) the di.erences in consumption growth rates across countries when international capital markets are considered, ii) the low growth and low levels of education in developing countries where the return on education is very high. This paper introduces a generational structure that implies that the return on human capital is higher than the return on physical capital and that consumption growth rates vary across countries when international capital markets are included. The human capital technology of the paper implies that poor countries grow more slowly and invest a smaller share of income on education, in spite of an extraordinarily high return on education and the existence of international capital markets.
|Date of creation:||Feb 2003|
|Date of revision:|
|Contact details of provider:|| Postal: Calle Pérez de Rosas 4, Santa Cruz de Tenerife 38004|
Web page: http://www.caerp.com/
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:cae:caerpp:9. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jose-Victor Rios-Rull)
If references are entirely missing, you can add them using this form.