nep-hrm New Economics Papers
on Human Capital and Human Resource Management
Issue of 2009‒06‒17
seventeen papers chosen by
Fabio Sabatini
University of Siena

  1. Human Capital Composition and Economic Growth at a Regional Level. By Fabio Manca
  2. Poor's behaviour and inequality traps: the role of human capital By Vincenzo Lombardo
  3. Parameter identification, population and economic growth in an extended Lucas and Uzawa-type two sector model By Alberto BUCCI; Herb E. KUNZE; Davide LA TORRE
  4. The Century of Education By Christian Morrisson; Fabrice Murtin
  5. Human and cultural capital complementarities and externalities in economic growth By Alberto BUCCI; Giovanna SEGRE
  6. Building Social Trust: A Human Capital Approach By Fali Huang
  7. Dual Economy Models: A Primer for…Growth, Income Distribution and Poverty Analysis By Vincenzo Lombardo
  8. Scale effects, saving and factor shares in a human capital-based growth model with physical capital accumulation By Alberto BUCCI
  9. Appropriate IPRs, Human Capital Composition and Economic Growth By Fabio Manca
  10. Population and economic growth with human and physical capital investments By Alberto BUCCI; Davide LA TORRE
  11. Uncertainty in financing higher education By Manolescu, Gheorghe
  12. The reform of education funding: principles, options, modalities By Manolescu, Gheorghe
  13. The training in market economy By Barbu, Adina; Chirimbu, Sebastian
  14. Population in factor accumulation-based growth By Alberto BUCCI
  15. On human capital and economic growth with random technology shocks By Alberto BUCCI; Cinzia COLAPINTO; Martin FORSTER; Davide LA TORRE
  16. Elegance with substance By Colignatus, Thomas
  17. Schooling, Cognitive Skills, and the Latin American Growth Puzzle By Eric A. Hanushek; Ludger Woessmann

  1. By: Fabio Manca (Faculty of Economics, University of Barcelona)
    Abstract: With this paper we build a two-region model where both innovation and imitation are performed. In particular imitation takes the form of technological spillovers that lagging regions may exploit given certain human capital conditions. We show how the high skill content of each region’s workforce (rather than the average human capital stock) is crucial to determine convergence towards the income level of the leader region and to exploit the technological spillovers coming from the frontier. The same applies to bureaucratic/institutional quality which are conductive to higher growth in the long run. We test successfully our theoretical result over Spanish regions for the period between 1960 and 1997. We exploit system GMM estimators which allow us to correctly deal with endogeneity problems and small sample bias.
    Keywords: Human Capital, Growth, Catch-Up.
    Date: 2009–06
  2. By: Vincenzo Lombardo (Department of Economic Studies, Parthenope University of Naples)
    Keywords: -
    Date: 2008–10
  3. By: Alberto BUCCI; Herb E. KUNZE; Davide LA TORRE
    Abstract: The aim of this paper is twofold. First of all we re-examine the long-run relationship between population and economic growth. To do this we extend the Lucas-Uzawa model along two different directions: we introduce the growth of the physical capital stock into the human capital supply equation and include in the intertemporal maximization problem of the representative household a preference parameter controlling for the degree of agents’ altruism towards future generations. These two extensions allow us to capture eventual complementarity/substitutability links between physical and human capital in the production of new human capital and to study how such links, along with agents’ altruism, may impact on the interplay between economic and demographic growth along the balanced growth path equilibrium. In the second part of this paper we develop the inverse problem for this extended Lucas-Uzawa model. The method we are going to use is based on fractals and has been developed by two of the authors in recent papers. Through the solution of the inverse problem one can get the estimation of some key-parameters such as the total factor productivity, the productivity of human capital in the production of new skills, the physical capital share in total income, the inverse of the intertemporal elasticity of substitution in consumption, the depreciation rate of (physical and human) capital and the parameter controlling for the degree of altruism towards future generations.
    Keywords: Population Growth, Two-Sector Endogenous Growth Models, Human Capital Investment, Physical Capital Accumulation, Fractal-based Methods, Inverse Problems, Collage Theorem
    JEL: O41 J24 J10
    Date: 2008–10–22
  4. By: Christian Morrisson; Fabrice Murtin
    Abstract: This paper presents a historical database on educational attainment in 74 countries for the period1870-2010, using perpetual inventory methods before 1960 and then the Cohen and Soto (2007)database. The correlation between the two sets of average years of schooling in 1960 is equal to 0.96.We use a measurement error framework to merge the two databases, while correcting for a systematicmeasurement bias in Cohen and Soto (2007) linked to differential mortality across educational groups.Descriptive statistics show a continuous spread of education that has accelerated in the second half ofthe twentieth century. We find evidence of fast convergence in years of schooling for a sub-sample ofadvanced countries during the 1870-1914 globalization period, and of modest convergence since1980. Less advanced countries have been excluded from the convergence club in both cases.
    Keywords: Inequality, human capital, economic history, copula function
    JEL: D31 E27 F02 N00 O40
    Date: 2009–06
  5. By: Alberto BUCCI; Giovanna SEGRE
    Abstract: The aim of this paper is to investigate the role of culture, viewed according to Throsby’s definition of cultural capital (that is, an asset of tangible and intangible cultural expressions), in fostering economic growth. Recent literature in the field of cultural economics highlights a possible inversion of the usual causality relation, and culture can be seen as one of the engine of economic wealth. In this article we analyze one possible channel through which it may occur: human capital investment. Using a two-sectors endogenous growth model, the relation between cultural and human capital is deeply investigated.
    Keywords: Economic growth, culture, human capital, complementarities, externalities
    JEL: O40 O41 Z10 J24
    Date: 2009–02–07
  6. By: Fali Huang (School of Economics, Singapore Management University)
    Abstract: Much evidence suggests individuals differ in their predisposition to cooperate, which is essentially a component of human capital. This paper examines the role of individual cooperative tendencies and their interactions with institutions in generating social trust; it also endogenizes cooperative tendencies using a human capital investment model. Multiple equilibria and ineffciencies exist due to positive externalities. An innovative fi?nding is that, when institutions are more e¤ective in punishing defecting behaviors, more people invest in cooperative tendencies and hence the endogenous social trust is higher, though the equilibrium cooperative tendencies are lower. This paper provides a plausible explanation for many empirical and experimental results
    JEL: Z13 J24
    Date: 2007–09
  7. By: Vincenzo Lombardo (Department of Economic Studies, Parthenope University of Naples)
    Keywords: Dual economy, poverty, inequality, human capital, informal sector
    Date: 2008–12
  8. By: Alberto BUCCI
    Abstract: Using a balanced-growth model with physical and human capital accumulation, this article analyzes quantitatively the long run effects of changes in the saving rate and in income distribution (i.e., the shares of physical and human capital in income) on investment in human capital, growth of income, and the ratio of human to physical capital. In the long run the ratio of physical to human capital is constant, so that these two production factors can grow at the same rate. This rate is a function of the economy’s exogenous technological and preference parameters and depends positively on the share of skills invested in human capital formation. We also find that population growth is neither necessary nor conducive to economic growth and that the level of real income depends linearly on the level of human capital and is independent of population size.
    Keywords: Economic Growth, Human and Physical Capital Investment, Scale Effects
    JEL: O41 J22 J24
    Date: 2008–07–26
  9. By: Fabio Manca (Faculty of Economics, University of Barcelona)
    Abstract: We generalize a standard technology diffusion model by allowing for IPRs regimes to be endogenously defined by the development level of each country. Also we insert differences in the composition of human capital between North (leader) and South (followers) which shape the relative costs of innovation and imitation. Results show how an optimal growth trajectory is found for the follower country which initially imitates and that, once a "threshold development stage" is reached, optimally switches to innovation by fully enforcing IPRs achieving a higher proximity with the technology frontier in the long-run. Other scenarios, such as a premature increase in the enforcement of IPRs or a switch from imitation to innovation at early stages of development of the followers are found to be sub-optimal.
    Keywords: IPRs, Human capital, Technology transfer.
    Date: 2009–06
  10. By: Alberto BUCCI; Davide LA TORRE
    Abstract: We present a two-sector endogenous growth model with human and physical capital accumulation in order to analyze the long run relationship between population growth and real per capita income growth. Learning is assumed to affect agents’ decision of how much to invest in formal education. Along the balanced growth path equilibrium population change may have a positive, negative, or neutral effect on economic growth depending on whether physical and human capital are complementary/substitutes for each other in the production of new human capital and on their degree of complementarity.
    Keywords: Economic Growth, Population Chang, Learning by using, Human Capital Investment, Physical Capital Accumulation
    JEL: O41 J24 J10
    Date: 2007–12–03
  11. By: Manolescu, Gheorghe (Universitatea Spiru Haret, Facultatea de Finante si Banci)
    Abstract: Communication address public education financing, taking into account explicitly the risk aspects of private investment in education. Advantages of public education, financed from public funds, consist of lack of markets lies in that students can protect against risks, an example being the education taxes that depend on expected income from investment in education. Considering the risk, the uncertainty highlights a link hitherto omitted between educational choice, resource endowment and productivity growth, which may serve to redefine the role of public education.
    Keywords: human capital; cost in terms of success; certainty equivalent; private financing; public financing; risk education; tax on distributed profits of investment
    JEL: D81 H52 I22
    Date: 2009–06–01
  12. By: Manolescu, Gheorghe (Universitatea Spiru Haret, Facultatea de Finante si Banci)
    Abstract: Driver education is a social determinant of human development, of spiritual evolution, directly influencing all social fields, particularly economy, and in this respect, targeting resources, especially financial, to support a quality education, values and competence is a goal, a requirement and an undeniable necessity. Communication that presents seeks to highlight economic dimensions of education, to problematizeze current funding of education and to formulate guidelines and some aspects of education funding reform, presenting several possible alternatives for financing education through a combination of various sources of funding: government, private and community (local) budget, banking and capital markets, domestic and international. Finally, it exposed a scheme of financing on educational levels, taking into account the nature of education, income and the cost of education, ability to finance the two sectors of the economy: public and private.
    Keywords: educational equity; education economics; private funding; public funding; level of education; education loan market.
    JEL: G32 H52 I22
    Date: 2009–06–01
  13. By: Barbu, Adina (Universitatea Spiru Haret, Facultatea de Finante si Banci); Chirimbu, Sebastian (Universitatea Spiru Haret, Facultatea de Finante si Banci)
    Abstract: The present global economic situation led to a re-consideration of the place held by human resources professional formation and development within an organization and on a larger scale of the place that a country's labour force development and specialization should hold for overcoming the effects of the global economic crisis. First of all the formal education achieved in schools, highschools and universities should support the society's (at a macro level) and community's (at a micro level) efforts to reach economic and social progress and should act as a catalizator for progress, due to simplified curricula, adapted to the labour force demands and foreseeing global research trends and domanins. However, formal education is only the premises for human resources development in contemporary organizations; trainings are the ones which will make a difference between the human resources of different companies, due to the knowledge and abilities that are taught to employees.
    Keywords: training; mobilities
    JEL: A29 I21
    Date: 2009–06–01
  14. By: Alberto BUCCI
    Abstract: This paper analyzes the conditions under which, within a two-sector endogenous growth model with human and physical capital accumulation but without R&D-driven disembodied technological progress, it is possible to observe an ambiguous effect of population growth on economic growth, as empirical evidence suggests. We present three models. In each of them the engine of long-run growth is human capital accumulation. Population growth exerts ambiguous effects on economic growth only when human and physical capital are complementary for each other in the production of new human capital. This result is explained in terms of the interplay between the “dilution” and “accumulation” effects. In accordance with the growth literature exhibiting endogenous human capital accumulation and R&D activity, we also find that income growth can be positive even with stable population, that both the growth rate and the level of per-capita income are independent of population size, and finally that the level of per-capita income is proportional to per-capita human capital. We conclude that it is possible to reach the same results even without explicitly assuming endogenous and purposeful investment in research by firms
    Keywords: Population Size and Growth, Scale Effects, Per-Capita Income; Economic Growth, Human Capital Investment, Physical Capital Accumulation
    JEL: O41 J24 J10
    Date: 2008–06–09
  15. By: Alberto BUCCI; Cinzia COLAPINTO; Martin FORSTER; Davide LA TORRE
    Abstract: We embed the Uzawa-Lucas human capital accumulation technology into the Mankiw-Romer-Weil exogenous growth model. The paper is divided into two parts. In the first part we assume that the rate of technological progress is exogenous and deterministic and study the local dynamics of the model around its steady-state equilibrium. The first order conditions lead to a system of four nonlinear differential equations. By reducing the dimension of the system to three, we find that the equilibrium is a saddle point. If the equations system is attacked in its original dimension, and by making use of an arbitrage condition, we prove that the equilibrium is unstable. In the second part of the paper technology is assumed to be subject to random shocks driven by a geometric Brownian motion. Using the Hamilton-Jacobi-Bellman equation, and through numerical simulations, we discuss the effects of technology shocks on the optimal policies of consumption and the allocation of human capital across sectors.
    Keywords: Economic Growth, Physical and Human Capital Accumulation, Technology Shocks
    JEL: C61 C63 J24 O41 O33
    Date: 2008–11–05
  16. By: Colignatus, Thomas
    Abstract: National parliaments around the world are advised to each have their own national parliamentary enquiry into the education in mathematics and into what is called ‘mathematics’. Current mathematics namely fails and causes extreme social costs. The failure in mathematics and math education can be traced to a deep rooted tradition and culture in mathematics itself. Mathematicians are trained for abstract theory but when they teach then they meet with real life pupils and students. Didactics requires a mindset that is sensitive to empirical observation which is not what mathematicians are basically trained for. When mathematicians deal with empirical issues then problems arise in general. The stock market crash in 2008 was caused by many factors, including mismanagement by bank managers and failing regulation, but also by mathematicians and ‘rocket scientists’ mistaking abstract models for reality (Mandelbrot & Taleb 2009). Another failure arises in the modelling of the economics of the environment where an influx of mathematical approaches causes too much emphasis on elegant form and easy notions of risk but insufficient attention to reality, statistics and real risk (Tinbergen & Hueting 1991). Errors by mathematicians on realistic assumptions have important consequences for civic discourse and democracy as well (Colignatus 2007). The failure in math education is only one example in a whole range. The discussion of mathematics in this book can be understood by anyone with a decent command of highschool mathematics. While school math should be clear and didactically effective, a closer look shows that it is cumbersome and illogical. (1) This is illustrated with some twenty examples from a larger stock of potential topics. (2) Additional shopping lists for improvement on both content and didactic method can be formulated as well. (3) Improvements appear possible with respect to mathematics itself, on logic, voting theory, trigonometry and calculus. (4) What is called mathematics thus is not really mathematics. Pupils and students are psychologically tortured and withheld from proper mathematical insight and competence. Other subjects, like the education in economics, biology or physics, suffer as well. Application of economic theory helps us to understand that markets for education and ideas tend to be characterized by monopolistic competition and natural monopolies. Regulations then are important. Apparently the industry of mathematics education currently is not adequately regulated. The regulation of financial markets is a hot topic nowadays but the persistent failure of mathematics education should rather be high on the list as well. It will be important to let the industry become more open to society. When you want to understand the underlying historical processes that cause the current state of the world then this is the book for you. Mathematics education must be tackled, both as a noble goal of itself and for the larger causes.
    Keywords: education; mathematics; economics; school; college; university; training; skill; ability; human capital policy; human development; capacity formation; remediation; lifecycle skill formation; software; ICT; computer algebra; textbook publishing; learning; teaching; efficacy; regulation; policy evaluation;
    JEL: A20 I20 P16
    Date: 2009–05–11
  17. By: Eric A. Hanushek; Ludger Woessmann
    Abstract: Economic development in Latin America has trailed most other world regions over the past four decades despite its relatively high initial development and school attainment levels. This puzzle can be resolved by considering the actual learning as expressed in tests of cognitive skills, on which Latin American countries consistently perform at the bottom. In growth models estimated across world regions, these low levels of cognitive skills can account for the poor growth performance of Latin America. Given the limitations of worldwide tests in discriminating performance at low levels, we also introduce measures from two regional tests designed to measure performance for all Latin American countries with internationally comparable income data. Our growth analysis using these data confirms the significant effects of cognitive skills on intra-regional variations. Splicing the new regional tests into the worldwide tests, we also confirm this effect in extended worldwide regressions, although it appears somewhat smaller in the regional Latin American data than in the worldwide data.
    JEL: H4 I2 O4 N16
    Date: 2009–06

This nep-hrm issue is ©2009 by Fabio Sabatini. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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