Availability of Higher Education and Long-Term Economic Growth
This paper examines the economic growth effects of limited availability of higher education in a simple endogenous growth model with overlapping generations. With limited availability, the scarcity of human capital keeps its price high and distributes a larger share of the aggregate output to young households. Under certain conditions, it leads to greater aggregate savings in each period, thereby enabling the economy to grow faster than without any limitation. In such cases, an excessive expansion in the availability causes a temporary boom followed by a serious deficiency in investible funds, resulting in a substantial slowdown in economic growth.
|Date of creation:||12 Apr 2005|
|Date of revision:||08 Sep 2005|
|Note:||Type of Document - pdf; pages: 37|
|Contact details of provider:|| Web page: http://econwpa.repec.org|
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.:
- Kiminori Matsuyama, 1996.
"Growing Through Cycles,"
1203, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Francesco Caselli, 2005.
"Accounting for Cross-Country Income Differences,"
CEP Discussion Papers
dp0667, Centre for Economic Performance, LSE.
- Pritchett, Lant, 1996. "Where has all the education gone?," Policy Research Working Paper Series 1581, The World Bank.
- Modigliani, Franco, 1986.
"Life Cycle, Individual Thrift, and the Wealth of Nations,"
American Economic Review,
American Economic Association, vol. 76(3), pages 297-313, June.
- Modigliani, Franco, 1985. "Life Cycle, Individual Thrift and the Wealth of Nations," Nobel Prize in Economics documents 1985-1, Nobel Prize Committee.
- Temple, Jonathan R. W., 2001. "Generalizations that aren't? Evidence on education and growth," European Economic Review, Elsevier, vol. 45(4-6), pages 905-918, May.
- Jappelli, Tullio & Pagano, Marco, 1992.
"Saving, Growth and Liquidity Constraints,"
CEPR Discussion Papers
662, C.E.P.R. Discussion Papers.
- Barro, R.J., 1989.
"Economic Growth In A Cross Section Of Countries,"
RCER Working Papers
201, University of Rochester - Center for Economic Research (RCER).
- Paul M Romer, 1999.
"Increasing Returns and Long-Run Growth,"
Levine's Working Paper Archive
2232, David K. Levine.
- Nazrul Islam, 1995. "Growth Empirics: A Panel Data Approach," The Quarterly Journal of Economics, Oxford University Press, vol. 110(4), pages 1127-1170.
- De Gregorio, Jose, 1996. "Borrowing constraints, human capital accumulation, and growth," Journal of Monetary Economics, Elsevier, vol. 37(1), pages 49-71, February.
- de la Croix,David & Michel,Philippe, 2002.
"A Theory of Economic Growth,"
Cambridge University Press, number 9780521806428, December.
- Costas Azariadis & Allan Drazen, 1990. "Threshold Externalities in Economic Development," The Quarterly Journal of Economics, Oxford University Press, vol. 105(2), pages 501-526.
- 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.
- Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, Oxford University Press, vol. 87(3), pages 355-374.
- Barro, Robert J. & Lee, Jong-Wha, 1994. "Sources of economic growth," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 40(1), pages 1-46, June.
- 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.
- José De Gregorio & Se-Jik Kim, 1998.
"Credit Markets with Differences in Abilities: Education, Distribution, and Growth,"
Documentos de Trabajo
42, Centro de Economía Aplicada, Universidad de Chile.
- De Gregorio, Jose & Kim, Se-Jik, 2000. "Credit Markets with Differences in Abilities: Education, Distribution, and Growth," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 41(3), pages 579-607, August.
- Jose De Gregorio & Se-Jik Kim, 1994. "Credit Markets with Differences in Abilities; Education, Distribution, and Growth," IMF Working Papers 94/47, International Monetary Fund.
- Christou, Costas, 2001. "Differential Borrowing Constraints and Investment in Human Capital," Journal of Macroeconomics, Elsevier, vol. 23(2), pages 277-295, April.
- Jose De Gregorio, 1991.
"Economic Growth in Latin America,"
IMF Working Papers
91/71, International Monetary Fund.
- Paul M. Romer, 1989.
"Human Capital And Growth: Theory and Evidence,"
NBER Working Papers
3173, National Bureau of Economic Research, Inc.
- Romer, Paul M., 1990. "Human capital and growth: Theory and evidence," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 32(1), pages 251-286, January.
- Andrew Weiss, 1995. "Human Capital vs. Signalling Explanations of Wages," Journal of Economic Perspectives, American Economic Association, vol. 9(4), pages 133-154, Fall.
- Topel, Robert, 1999. "Labor markets and economic growth," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 44, pages 2943-2984 Elsevier.
- Card, David, 1999. "The causal effect of education on earnings," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 30, pages 1801-1863 Elsevier.
- Klenow, Peter J. & Rodriguez-Clare, Andres, 2005.
"Externalities and Growth,"
Handbook of Economic Growth,
in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 11, pages 817-861
When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpdc:0504005. 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: (EconWPA)
If references are entirely missing, you can add them using this form.