Education as a driver of income inequality in twentieth-century Africa

In this paper, we address the issue of how education affected income inequality in twentieth-century Africa. Three channels are identified through which education may affect income inequality. First, an increase in the average educational level is correlated with an increase in average income, which, ceteris paribus, reduces inequality. Second, a reduction in educational inequality may, given a positive correlation between education level and income, reduce income inequality. Thirdly, an increase in the supply of education may decrease the price of skilled labour thus lowering income inequality. We find that in the long-run education does not affect income growth, indicating that in twentieth-century Africa it was inspiration (i.e., Total Factor Productivity [TFP]) rather than perspiration (i.e., education and physical capital) that drove economic development. Testing for the effects of the remaining two channels, we found a significant non-linear relationship between educational and income inequality suggesting that, contrary to the level of education, these two channels were important in determining income inequality in Africa. Taking an example from the end of the twentieth century, if educational equality had been eliminated, then income inequality would decline by no less than 81%

Regional human capital in Republican and New China: Its spread, quality and effects on economic growth

In recent decades there has been increasing attention for Chinese economic development. There has been a big debate though if its growth is caused by capital accumulation (perspiration factors) or driven by Total Factor Productivity (TFP) growth (inspiration factors). The difference between both stances is quite substantial since, if the perspiration theory is correct, one expects the growth of the Chinese economy to slow down over time as the capital accumulation grows increasingly less efficient. However, so far this question is difficult to analyse for China since we lack information on one of the factors of production, human capital. To analyse this question, in this paper we develop a new dataset on human capital for the provinces of China between 1922 and 2010. Using our new dataset, together with physical capital and per capita GDP, allows us to do a TFP analysis for sub periods. We find a continuously negative TFP growth suggesting that reduction in productivity was a structural feature of the Chinese economy. If true, this was to lend support to the perspiration theory and would suggest a slowdown of the Chinese economy in the future. However, standard growth accounting allocates both technical efficiency of the factors of production and the general technical development to TFP. Subtracting technical efficiency from TFP growth, we find that general technological development turns increasingly positive in the 1990s and 2000s. This suggests that, whereas until the reform period China was largely driven by capital accumulation, afterwards general technical development got an increasingly prominent place giving hope for continued economic development in the future

Education as a driver of income inequality in twentieth-century Africa

In this paper, we address the issue of how education affected income inequality in twentieth-century Africa. Three channels are identified through which education may affect income inequality. First, an increase in the average educational level is correlated with an increase in average income, which, ceteris paribus, reduces inequality. Second, a reduction in educational inequality may, given a positive correlation between education level and income, reduce income inequality. Thirdly, an increase in the supply of education may decrease the price of skilled labour thus lowering income inequality. We find that in the long-run education does not affect income growth, indicating that in twentieth-century Africa it was inspiration (i.e., Total Factor Productivity [TFP]) rather than perspiration (i.e., education and physical capital) that drove economic development. Testing for the effects of the remaining two channels, we found a significant non-linear relationship between educational and income inequality suggesting that, contrary to the level of education, these two channels were important in determining income inequality in Africa. Taking an example from the end of the twentieth century, if educational equality had been eliminated, then income inequality would decline by no less than 81%

Regional human capital in Republican and New China: Its spread, quality and effects on economic growth

In recent decades there has been increasing attention for Chinese economic development. There has been a big debate though if its growth is caused by capital accumulation (perspiration factors) or driven by Total Factor Productivity (TFP) growth (inspiration factors). The difference between both stances is quite substantial since, if the perspiration theory is correct, one expects the growth of the Chinese economy to slow down over time as the capital accumulation grows increasingly less efficient. However, so far this question is difficult to analyse for China since we lack information on one of the factors of production, human capital. To analyse this question, in this paper we develop a new dataset on human capital for the provinces of China between 1922 and 2010. Using our new dataset, together with physical capital and per capita GDP, allows us to do a TFP analysis for sub periods. We find a continuously negative TFP growth suggesting that reduction in productivity was a structural feature of the Chinese economy. If true, this was to lend support to the perspiration theory and would suggest a slowdown of the Chinese economy in the future. However, standard growth accounting allocates both technical efficiency of the factors of production and the general technical development to TFP. Subtracting technical efficiency from TFP growth, we find that general technological development turns increasingly positive in the 1990s and 2000s. This suggests that, whereas until the reform period China was largely driven by capital accumulation, afterwards general technical development got an increasingly prominent place giving hope for continued economic development in the future

汉代中国、罗马帝国东部和巴比伦尼亚社会生活水平的比较 (The Standard of Living in Ancient Societies: A Comparison between the Han Empire, the Eastern Roman Empire and Babylonia)

In recent years, interest in the welfare levels of ancient economies has increased considerably, partly in a quest to find the origins of present-day income differences. A popular method for calculating income differences is the use of subsistence ratios that indicate whether the wage of an unskilled male labourer is sufficient to purchase enough products and services to maintain his family. In this paper, we present new estimates for the southeastern part of Han China and modify existing estimates for the eastern half of the Roman Empire (Egypt and Syria) and Babylonia to make them comparable. We find that the agricultural regions of Egypt and Babylonia experienced substantially lower subsistence ratios than Syria and southeastern Han China. We find that the main reason for the difference was that unskilled male workers belonged to the higher income brackets in southeastern Han China and Syria. This finding can be explained by the small group of free wage workers in these societies, combined with excess demand for this type of labour in the Eastern Roman Empire and southeastern Han China

How did women count? A note on gender-specific age heaping differences in the sixteenth to nineteenth centuries

The role of human capital in economic growth is now largely uncontested. One indicator of human capital frequently used for the pre-1900 period is age heaping, which has been increasingly used to measure gender-specific differences. In this note, we find that in some historical samples, married women heap significantly less than unmarried women. This is still true after correcting for possible selection effects. A possible explanation is that a percentage of women adapted their ages to that of their husbands, hence biasing the Whipple index. We find the same effect to a lesser extent for men. Since this bias differs over time and across countries, a consistent comparison of female age heaping should be made by focusing on unmarried women