Human Capital and Economic Growth in Asia 1890–2000: A Time‐series Analysis*

Abstract

There is a general consensus that human capital is a major factor behind long‐run economic growth. Yet, on a macro level, the empirical results do not always seem to concur with this view. To explain this gap between theory and empirics, more focus has been laid on measurement error and data quality. Using an alternative estimate of the stock of human capital, based on Judson (2002), we find evidence that the two major views on the role of human capital in economic development by Lucas (1988) and Romer (1990) coexist and are by no means mutually exclusive. Using a Johansen cointegration test, we find that in India and Indonesia the level of human capital is cointegrated with the level of aggregate income during the whole 20th century, which confirms the theory of Lucas (1988). In Japan, however, the Lucasian approach can be verified only for the first half of the century, while after 1950 there is cointegration between the growth rate of aggregate income and the level of human capital, which is in line with Romer's view.

Capital formation and economic growth under central planning and transition: A theoretical and empirical analysis, ca. 1920–2008

“…We introduce only a slight modification: we multiply the replacement value of a single year of education by the average years of education in order to obtain the replacement costs of the whole educational stock of the average individual (Van Leeuwen -Földvári 2008).…”

“…The result is given in Figure 2 below. We have to stress that the above model incorporates human capital as direct expenditure into the model, for which the closest empirical equivalent is the cost-based measure (see Judson 2002or Van Leeuwen -Földvári 2008. The income-based measures reflect private and social returns to human capital, so even though its trends should not deviate from the cost-based measurement for a very long period, it is much less appropriate for testing the model.…”

On the fit and forecasting performance of grey prediction models for China’s labor formation

“…Among all the forecasting studies in economic trends, extrapolation of time-series data on the quality and quantity of human capital in different nations has become an emerging topic of interest, e.g. [13][14][15][16][17].…”

Inspiration vs. perspiration in economic development of the Former Soviet Union and China (ca. 1920–2010)

“…However, instead of the natural proxies used by MRW, we prefer a human-capital, cost-based monetary measure, such as that proposed by Judson (2002) and updated by Van Leeuwen and F€ oldv ari (2008a). We then follow Mahadavan (2007) and Van Leeuwen et al (2011) with the standard TFP analysis, expressing changes of the variables in per capita terms (denoted by lowercase letters; for example, y instead of Y, and so on):…”