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Regional Growth and Convergence: The Role of Human Capital in the Portuguese Regions

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Potentially one of the most important determinants of regional economic growth and convergence is human capital, although due to a lack of data this factor is frequently omitted from econometric studies. In contrast, this paper constructs three measures of human capital at the NUTS III regional level for Portugal for the period 1991-2008 and then includes these variables in regional growth regressions. The results show that both secondary and higher levels of education have a significant positive effect on regional growth rates which may be regarded as supportive of Portuguese education policy, which over the last three decades has attempted to raise the regional human capital by locating higher education institutions across the country.

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File URL: http://www.lboro.ac.uk/departments/sbe/RePEc/lbo/lbowps/CardosoandPentecost.pdf
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Paper provided by Department of Economics, Loughborough University in its series Discussion Paper Series with number 2011_03.

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Date of creation: Sep 2011
Date of revision: Sep 2011
Handle: RePEc:lbo:lbowps:2011_03
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Loughborough, Leicestershire, LE11 3TU

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Web page: http://www.lboro.ac.uk/departments/sbe/research/economics/index.html

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  1. Arellano, Manuel & Bover, Olympia, 1995. "Another look at the instrumental variable estimation of error-components models," Journal of Econometrics, Elsevier, vol. 68(1), pages 29-51, July.
  2. Benhabib, Jess & Spiegel, Mark M., 2005. "Human Capital and Technology Diffusion," Handbook of Economic Growth,in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 13, pages 935-966 Elsevier.
  3. Angel de la Fuente & Rafael Doménech, 2006. "Human Capital in Growth Regressions: How Much Difference Does Data Quality Make?," Journal of the European Economic Association, MIT Press, vol. 4(1), pages 1-36, 03.
  4. Brülhart, Marius & Mathys, Nicole A., 2008. "Sectoral agglomeration economies in a panel of European regions," Regional Science and Urban Economics, Elsevier, vol. 38(4), pages 348-362, July.
  5. Richard Blundell & Stephen Bond, 2000. "GMM Estimation with persistent panel data: an application to production functions," Econometric Reviews, Taylor & Francis Journals, vol. 19(3), pages 321-340.
  6. Blundell, Richard & Bond, Stephen, 1998. "Initial conditions and moment restrictions in dynamic panel data models," Journal of Econometrics, Elsevier, vol. 87(1), pages 115-143, August.
  7. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 407-437.
  8. Benhabib, Jess & Spiegel, Mark M., 1994. "The role of human capital in economic development evidence from aggregate cross-country data," Journal of Monetary Economics, Elsevier, vol. 34(2), pages 143-173, October.
  9. Petrakis, P. E. & Stamatakis, D., 2002. "Growth and educational levels: a comparative analysis," Economics of Education Review, Elsevier, vol. 21(5), pages 513-521, October.
  10. Jérôme Vandenbussche & Philippe Aghion & Costas Meghir, 2004. "Growth, distance to frontier and composition of human capital," IFS Working Papers W04/31, Institute for Fiscal Studies.
  11. Pereira, João & St. Aubyn, Miguel, 2009. "What level of education matters most for growth?: Evidence from Portugal," Economics of Education Review, Elsevier, vol. 28(1), pages 67-73, February.
  12. Caselli, Francesco & Esquivel, Gerardo & Lefort, Fernando, 1996. "Reopening the Convergence Debate: A New Look at Cross-Country Growth Empirics," Journal of Economic Growth, Springer, vol. 1(3), pages 363-389, September.
  13. Windmeijer, Frank, 2005. "A finite sample correction for the variance of linear efficient two-step GMM estimators," Journal of Econometrics, Elsevier, vol. 126(1), pages 25-51, May.
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