Growth and Human Capital: A Network Approach
Accepted version
Peer-reviewed
Repository URI
Repository DOI
Change log
Authors
Cavalcanti, TVV
Giannitsarou, Chryssi https://orcid.org/0000-0002-1488-2433
Abstract
We study the interactions of human capital, growth and inequality by embedding networks into an endogenous growth model with overlapping generations. Human capital depends on investment in education and the average human capital of a household's neighborhood. High network cohesion leads to long run equality, while for low network cohesion inequality is high and persists more often. During transition, high overall growth is achieved when the network has high degree centralization, and high individual growth is achieved when the household has low human capital relative to its neighborhood and is located in a neighborhood with high average human capital.
Description
Keywords
human capital, growth, inequality, local externality, networks
Journal Title
Economic Journal
Conference Name
Journal ISSN
0013-0133
1468-0297
1468-0297
Volume Title
127
Publisher
Oxford University Press (OUP)
Publisher DOI
Sponsorship
Part of this paper was completed during Chryssi Giannitsarou’s visit to the Federal Reserve Bank of Minneapolis – she is grateful for their hospitality.