Were Mankiw, Romer, and Weil Right? A Reconcilation of the Micro and Macro Effects of Schooling on Income

49 Pages Posted: 16 Aug 2009 Last revised: 13 Apr 2014

See all articles by Theodore R. Breton

Theodore R. Breton

George Mason University - Department of Economics; Universidad EAFIT - School of Economics and Finance - Center for Research in Economic & Finance (CIEF)

Date Written: October 3, 2011

Abstract

The marginal product of human capital in Mankiw, Romer, and Weil’s [1992] augmented Solow model measures the direct and two external effects of human capital created from schooling on national income. If this model is valid, its estimates of the share of this marginal product accruing to workers should be consistent with estimates of the marginal return on investment in schooling in workers’ earnings’ studies. This paper uses a new set of data for the net human capital stock to show that in 1990 the micro and macro rates are consistent across 36 countries.

Keywords: Human Capital, Education, Schooling, Economic Growth, Cobb-Douglas Model, National Income, External Effects

JEL Classification: E13, I21, O11, O15, O41

Suggested Citation

Breton, Theodore R., Were Mankiw, Romer, and Weil Right? A Reconcilation of the Micro and Macro Effects of Schooling on Income (October 3, 2011). Available at SSRN: https://ssrn.com/abstract=1455161 or http://dx.doi.org/10.2139/ssrn.1455161

Theodore R. Breton (Contact Author)

George Mason University - Department of Economics ( email )

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Universidad EAFIT - School of Economics and Finance - Center for Research in Economic & Finance (CIEF) ( email )

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