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Human capital growth and poverty: Evidence from Ethiopia and Peru

Year: 2017

Type: article

Abstract: In this paper we use high quality data from two developing countries, Ethiopia and Peru, to estimate the production functions of human capital from age 1 to age 15. We characterize the nature of persistence and dynamic complementarities between two components of human capital: health and cognition. We also explore the implications of different functional form assumptions for the production functions. We find that more able and higher income parents invest more, particularly at younger ages when investments have the greatest impacts. These differences in investments by parental income lead to large gaps in inequality by age 8 that persist through age 15.

Source: Review of Economic Dynamics

DOI: 10.1016/j.red.2017.02.002

Authors: Orazio Attanasio, Costas Meghir, Emily Nix, Francesca Salvati

Institutions: Centre for Economic Policy Research, University College London, IZA - Institute of Labor Economics, Yale University, Institute for Evaluation of Labour Market and Education Policy

Language: English

Topic: Economic Growth and Productivity

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDGs: Reduced inequalities, Decent work and economic growth, No poverty

Open Access status: hybrid

Estimated APC paid: $3,320