Arbeitspapier

Education, Growth and Income Inequality

When types of workers are imperfect substitutes, the Mincerian rate of return to human capital is negatively related to the supply of human capital. We work out a simple model for the joint evolution of output and wage dispersion. We estimate this model using cross-country panel data on GDP and Gini coefficients. The results are broadly consistent with our hypothesis of diminishing returns to education. The implied elasticity of substitution fits Katz and Murphy's (1992) estimate. A one year increase in the stock of human capital reduces the rate of return by about 2 per cent. The combination of imperfect substitution and skill biased technological change closes the gap between the Mincer equation and GDP growth regressions almost completely.

Sprache
Englisch

Erschienen in
Series: CESifo Working Paper ; No. 653

Klassifikation
Wirtschaft

Ereignis
Geistige Schöpfung
(wer)
van Rens, Thijs
Ereignis
Veröffentlichung
(wer)
Center for Economic Studies and ifo Institute (CESifo)
(wo)
Munich
(wann)
2002

Handle
Letzte Aktualisierung
10.03.2025, 11:42 MEZ

Datenpartner

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Objekttyp

  • Arbeitspapier

Beteiligte

  • van Rens, Thijs
  • Center for Economic Studies and ifo Institute (CESifo)

Entstanden

  • 2002

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