Education and Growth: A Simple Model with Complicated Dynamics
We construct a simple model of education and growth in which young adults (children) spend a fraction of their time and old adults (parents) spend a fraction of their income on education. Both a strategic complementarity and an intergener- ational externality in the creation of human capital are present. The interactions between each pair of consecutive generations lead to rich dynamics. We show that multiple growth equilibria arise, some of them periodic and some aperiodic. We also ?nd a negative correlation between volatility and growth, without a one-way causal relationship between the two being, necessarily, present. Rather this negative correlation is driven by the structural characteristics of the economy.
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Robert J. Barro, 2001. "Human Capital and Growth," American Economic Review, American Economic Association, vol. 91(2), pages 12-17, May.
- Glomm, Gerhard, 1997. "Parental choice of human capital investment," Journal of Development Economics, Elsevier, vol. 53(1), pages 99-114, June.
- Ceroni, Carlotta Berti, 2001.
"Poverty Traps and Human Capital Accumulation,"
London School of Economics and Political Science, vol. 68(270), pages 203-19, May.
- Klaus, WAELDE, 2003.
"Endogenous growth cycles,"
Discussion Papers (IRES - Institut de Recherches Economiques et Sociales)
2004012, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES), revised 15 Mar 2004.
- Theodore Palivos & Dimitrios Varvarigos, 2009.
"Intergenerational Complementarities in Education and the Relationship between Growth and Volatility,"
Discussion Paper Series
2009_05, Department of Economics, University of Macedonia, revised Mar 2009.
- Theodore Palivos & Dimitrios Varvarigos, 2009. "Intergenerational Complementarities in Education and the Relationship between Growth and Volatility," Discussion Papers in Economics 09/8, Department of Economics, University of Leicester.
- Keith Blackburn & Dimitrios Varvarigos, 2008. "Human capital accumulation and output growth in a stochastic environment," Economic Theory, Springer, vol. 36(3), pages 435-452, September.
- Erik Canton, 2002. "Business cycles in a two-sector model of endogenous growth," Economic Theory, Springer, vol. 19(3), pages 477-492.
- Matsuyama, K., 1996.
"Growing through cycles,"
DELTA Working Papers
96-18, DELTA (Ecole normale supérieure).
- Grandmont, Jean-Michel, 1985.
"On Endogenous Competitive Business Cycles,"
Econometric Society, vol. 53(5), pages 995-1045, September.
- Grier, Kevin B. & Tullock, Gordon, 1989. "An empirical analysis of cross-national economic growth, 1951-1980," Journal of Monetary Economics, Elsevier, vol. 24(2), pages 259-276, September.
- Garey Ramey & Valerie A. Ramey, 1994.
"Cross-Country Evidence on the Link Between Volatility and Growth,"
NBER Working Papers
4959, National Bureau of Economic Research, Inc.
- Ramey, Garey & Ramey, Valerie A, 1995. "Cross-Country Evidence on the Link between Volatility and Growth," American Economic Review, American Economic Association, vol. 85(5), pages 1138-51, December.
- Femminis, Gianluca, 2001. " Risk-Sharing and Growth: The Role of Precautionary Savings in the "Education" Model," Scandinavian Journal of Economics, Wiley Blackwell, vol. 103(1), pages 63-77, March.
- 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.
- Jonathan Temple, 1999. "The New Growth Evidence," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 112-156, March.
- Long, John B, Jr & Plosser, Charles I, 1983. "Real Business Cycles," Journal of Political Economy, University of Chicago Press, vol. 91(1), pages 39-69, February.
When requesting a correction, please mention this item's handle: RePEc:mcd:mcddps:2009_08. 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: (Theodore Panagiotidis)
If references are entirely missing, you can add them using this form.