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Unequal opportunities and human capital formation

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  • Marc St-Pierre
  • Daniel Mejia

Abstract

This paper develops a tractable, heterogeneous agents general equilibrium model where agents face different costs of access to the educational system. The paper explores the relation between inequality of opportunities (in the form of differential costs of access to the educational process) and efficiency (the levels of human capital and output). More precisely, the results from the simulation of the model suggest that a higher level of inequality of opportunities is associated with a lower level of average human capital, lower output per worker and higher income (wage) inequality. In other words, the model (based on standard assumptions) does not predict a trade-off between efficiency and equal opportunity in human capital formation

Suggested Citation

  • Marc St-Pierre & Daniel Mejia, 2004. "Unequal opportunities and human capital formation," Econometric Society 2004 Latin American Meetings 188, Econometric Society.
  • Handle: RePEc:ecm:latm04:188
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    More about this item

    Keywords

    Human Capital; Inequality; Equity-Efficiency Tradeoff;
    All these keywords.

    JEL classification:

    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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