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Endogenous Cycles and Human Capital

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  • Dimitrios Varvarigos

Abstract

Existing evidence shows that activities promoting the formation of human capital are countercyclical. In a two period OLG model, I show that countercyclical investment in human capital arises as a result of a parametric combination relating to preferences and technologies. This countercyclical reaction is responsible for the non-monotonicity in the evolution of human capital, thus initiating a self-sustained sequence of events that generate endogenous cycles, and possibly chaotic dynamics.

Suggested Citation

  • Dimitrios Varvarigos, 2013. "Endogenous Cycles and Human Capital," Discussion Papers in Economics 13/18, Division of Economics, School of Business, University of Leicester.
    • Handle: RePEc:lec:leecon:13/18
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    More about this item

    Keywords

    Human capital; Cycles;

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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