The Money Value of a Man

60 Pages Posted: 12 May 2012  

Mark Huggett

Georgetown University - Department of Economics

Greg Kaplan

University of Pennsylvania

Multiple version iconThere are 2 versions of this paper

Date Written: May 2012

Abstract

This paper posits a notion of the value of an individual's human capital and the associated return on human capital. These concepts are examined using U.S. data on male earnings and financial asset returns. We find that (1) the value of human capital is far below the value implied by discounting earnings at the risk-free rate, (2) mean human capital returns exceed stock returns early in life and decline with age, (3) the stock component of the value of human capital is smaller than the bond component at all ages and (4) human capital returns and stock returns have a small positive correlation over the working lifetime.

Suggested Citation

Huggett, Mark and Kaplan, Greg, The Money Value of a Man (May 2012). NBER Working Paper No. w18066. Available at SSRN: https://ssrn.com/abstract=2056694

Mark Huggett (Contact Author)

Georgetown University - Department of Economics ( email )

Washington, DC 20057
United States
202-687-6683 (Phone)

Greg Kaplan

University of Pennsylvania ( email )

Philadelphia, PA 19104
United States

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