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Growth and Human Capital Accumulation under Uncertainty

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  • Rillaers, Alexandra

    (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))

Abstract

The aim of this paper is to understand the role of uncertainty in education choices and therefore in growth. We consider an overlapping generations model in which endogenous growth is introduced through human capital accumulation. We introduce uncertainty as to the individual returns to educational investment, and we assume markets to be incomplete. We study the effect of this uncertainty on the behavior of the risk averse individual regarding his effort in education. The analysis is carried out within a general equilibrium approach.

Suggested Citation

  • Rillaers, Alexandra, 1998. "Growth and Human Capital Accumulation under Uncertainty," LIDAM Discussion Papers IRES 1998020, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    • Handle: RePEc:ctl:louvir:1998020
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    File URL: http://sites.uclouvain.be/econ/DP/IRES/9820.pdf
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    References listed on IDEAS

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    1. Gary S. Becker, 1962. "Investment in Human Capital: A Theoretical Analysis," NBER Chapters, in: Investment in Human Beings, pages 9-49, National Bureau of Economic Research, Inc.
    2. Kodde, David A, 1986. "Uncertainty and the Demand for Education," The Review of Economics and Statistics, MIT Press, vol. 68(3), pages 460-467, August.
    3. Williams, Joseph T, 1979. "Uncertainty and the Accumulation of Human Capital over the Life Cycle," The Journal of Business, University of Chicago Press, vol. 52(4), pages 521-548, October.
    4. Levhari, David & Weiss, Yoram, 1974. "The Effect of Risk on the Investment in Human Capital," American Economic Review, American Economic Association, vol. 64(6), pages 950-963, December.
    5. Lucas, Robert E, Jr, 1990. "Supply-Side Economics: An Analytical Review," Oxford Economic Papers, Oxford University Press, vol. 42(2), pages 293-316, April.
    6. Theodore W. Schultz, 1960. "Capital Formation by Education," Journal of Political Economy, University of Chicago Press, vol. 68(6), pages 571-571.
    7. de la Croix, David, 1996. "Economic development and convergence clubs: the role of inherited tastes and human capital," LIDAM Discussion Papers IRES 1996024, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES), revised 00 Oct 1996.
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      More about this item

      Keywords

      Human capital; Growth; Education; Uncertainty; Overlapping Generations Model;
      All these keywords.

      JEL classification:

      • I29 - Health, Education, and Welfare - - Education - - - Other
      • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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