Human Capital and Growth
One ubiquitous element of both theoretical and empirical analyses of economic growth is the role of human capital. The skills of the population enter into both neoclassical and endogenous growth models. The most commonly used measure of human capital is the level of school attainment in a country, building upon the data development of Robert Barro and Jong-Wha Lee. This measure of human capital, however, requires the strong assumption that what is learned in a year of schooling is the same across all countries. It also presumes that human capital is only developed in formal schooling, contrary to the extensive evidence that families, neighborhoods, peers, and health also contribute to the development of human capital. In order to measure human capital more accurately, Eric Hanushek and Dennis Kimko introduced measures of mathematics and science skills from international assessments into growth analysis. They found that quality of human capital was very significantly related to economic growth. This approach has been extended by a variety of authors, and the evidence indicates that economic growth is very closely related to the cognitive skills of the population.
Read more about this topic: Economic Growth
Famous quotes containing the words human, capital and/or growth:
“If you pick up some paint with your brush and make somebody’s nose with it, this is rather ridiculous when you think of it, theoretically or philosophically. It’s really absurd to make an image, like a human image, with paint, today.”
—Willem De Kooning (b. 1904)
“I still need more healthy rest in order to work at my best. My health is the main capital I have and I want to administer it intelligently.”
—Ernest Hemingway (1899–1961)
“A man’s growth is seen in the successive choirs of his friends. For every friend whom he loses for truth, he gains a better.”
—Ralph Waldo Emerson (1803–1882)