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Human Capital, Productivity and Growth

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Abstract

In this paper new estimates of human capital prices and quantities, taking into account technological change in human capital production and endogenous education choice, are presented for both Canada and the United States. The implications of the estimates for the sources of growth are examined. The most striking result is that adjusting the labour input for quality increases reduces the contribution of MFP growth in standard of living growth to zero. The largest part of this quality increase is not due to composition changes but instead to technological change in human capital production. Since most attempts at adjusting the labour input for quality changes only deal with composition, they cannot capture a large part of the quality change. The results suggest that technological improvement in human capital production could be the major source of standard of living growth in the last few decades.

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  • Audra J. Bowlus & Haoming Liu & Chris Robinson, 2005. "Human Capital, Productivity and Growth," University of Western Ontario, Centre for Human Capital and Productivity (CHCP) Working Papers 20052, University of Western Ontario, Centre for Human Capital and Productivity (CHCP).
  • Handle: RePEc:uwo:hcuwoc:20052
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    1. Ananth Seshadri & Rodolfo Manuelli, 2005. "Human Capital and the Wealth of Nations," 2005 Meeting Papers 56, Society for Economic Dynamics.
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    3. Hansen, G D, 1993. "The Cyclical and Secular Behaviour of the Labour Input: Comparing Efficiency Units and Hours Worked," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 8(1), pages 71-80, Jan.-Marc.
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    5. Audra Bowlus & Haoming Liu & Chris Robinson, 2002. "Business Cycle Models, Aggregation, and Real Wage Cyclicality," Journal of Labor Economics, University of Chicago Press, vol. 20(2), pages 308-335, Part.
    6. Eric A. Hanushek & Dongwook Kim, 1995. "Schooling, Labor Force Quality, and Economic Growth," NBER Working Papers 5399, National Bureau of Economic Research, Inc.
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    11. Audra J. Bowlus & Chris Robinson, 2005. "The Contribution of Post-Secondary Education to Human Capital Stocks in Canada and the United States," University of Western Ontario, Centre for Human Capital and Productivity (CHCP) Working Papers 20051, University of Western Ontario, Centre for Human Capital and Productivity (CHCP).
    12. Serge Coulombe & Jean-François Tremblay, 2004. "Literacy, Human Capital and Growth," Working Papers 0407E, University of Ottawa, Department of Economics.
    13. Chris Robinson & Audra J. Bowlus, 2004. "Technological Change in the Production of Human Capital: Implications for Human Capital Stocks, Wages and Skill Differentials," 2004 Meeting Papers 218, Society for Economic Dynamics.
    14. Chinloy, Peter T, 1980. "Sources of Quality Change in Labor Input," American Economic Review, American Economic Association, vol. 70(1), pages 108-119, March.
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    Cited by:

    1. Audra J. Bowlus & Chris Robinson, 2012. "Human Capital Prices, Productivity, and Growth," American Economic Review, American Economic Association, vol. 102(7), pages 3483-3515, December.
    2. Audra J. Bowlus & Chris Robinson, 2005. "The Contribution of Post-Secondary Education to Human Capital Stocks in Canada and the United States," University of Western Ontario, Centre for Human Capital and Productivity (CHCP) Working Papers 20051, University of Western Ontario, Centre for Human Capital and Productivity (CHCP).

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