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Human capital, self-esteem, and income inequality

Author

Listed:
  • Mark Gradstein

    (Ben Gurion University)

  • Luigi Ventura

    (Sapienza University)

Abstract

We introduce into a human-capital based growth framework utility from self-esteem, driven by academic achievements. Self-esteem, through its effect on human capital, is shown to shape the intertemporal evolution and the persistence of income inequality, in general, and across population groups. Inequality persistence is obtained because of the wedge that the self-esteem component creates between households whose academic achievements are high enough as opposed to those whose achievements are insufficiently low. Among the several extensions, it is shown that controlling parenting style can exacerbate income inequality while reducing children’s self-esteem.

Suggested Citation

  • Mark Gradstein & Luigi Ventura, 2024. "Human capital, self-esteem, and income inequality," Journal of Economic Growth, Springer, vol. 29(4), pages 515-541, December.
    • Handle: RePEc:kap:jecgro:v:29:y:2024:i:4:d:10.1007_s10887-023-09235-7
    DOI: 10.1007/s10887-023-09235-7
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    More about this item

    Keywords

    Cultural traits; Self-esteem; Growth; Persistent inequality;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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