The Effect of Utilization Rate on Specialization

Economic Inquiry, Vol. 22, No. 1, 1984

Posted: 30 Aug 2012

See all articles by Yoram Barzel

Yoram Barzel

University of Washington

Ben T. Yu

California State University, Northridge - Department of Economics

Date Written: January 1, 1984

Abstract

The recognition that investment in human capital depends on its utilization (i.e., the number of hours it is used) is offered as an explanation of diverse phenomena such as of tourists' behavior, women's participation rate in the labor force, and the decline of investment in human capital with age. In this paper we examine the way the utilization rate of human capital affects specialization. We demonstrate that even if training in each specialty is subject to diminishing returns or rising cost, the utilization effects of human capital would prompt two identical individuals to specialize their training, and therefore hours of work, in different occupations.

Suggested Citation

Barzel, Yoram and Yu, Ben T., The Effect of Utilization Rate on Specialization (January 1, 1984). Economic Inquiry, Vol. 22, No. 1, 1984, Available at SSRN: https://ssrn.com/abstract=2138494

Yoram Barzel

University of Washington ( email )

Box 353330
Seattle, WA 98195-3330
United States
206-543-2510 (Phone)
206-685-7477 (Fax)

Ben T. Yu (Contact Author)

California State University, Northridge - Department of Economics ( email )

Northridge, CA 91330
United States
818-677-4582 (Phone)
818-677-2462 (Fax)

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