Does the Diversity of Human Capital Increase GDP? A Comparison of Education Systems

This paper examines how different education systems affect GDP by influencing the diversity of human capital. We construct an overlapping generation model in which agents are heterogeneous in income and innate ability, and the final goods are produced with differentiated intermediate goods. We analyze an economy in which an income distribution converges to a stationary distribution. It is shown that the diversity of human capital induced by income inequality always lowers the GDP of the next period, while the diversity of human capital induced by heterogeneous ability can increase GDP, if the produced intermediate goods are sufficiently substitutable and firms have a large span of control. Hence, as public education equalizes education resources across households, it mitigates the negative effect of income inequality on GDP, while the effects of ability tracking crucially depend on the production structure of the economy.Span of control, Complementarities, Human capital, Ability tracking

On the Role of Job Assignment in a Comparison of Education Systems

This paper reexamines how differences in systems for financing education influence GDP by highlighting a neglected function of education policy: it affects the magnitude of gains from job assignment. When more productive jobs demand more skill, privately financed education can increase productivity gains from matching between jobs and skill by increasing the availability of highly educated people. This differs from the standard argument that publicly financed education increases the total amount of human capital by equalizing educational opportunities. It is shown that if job opportunities have large variations in productivity, education policy may face a serious efficiency--equity trade-off.Job assignment, Human capital, Education system

Gender specialization in households: An empirical analysis

This paper studies the effect of parental education on the educational attainment of children in the US for cohorts born after 1910. Importantly, we allow for cohort-specific differences by gender. Our estimates show that paternal education has been more important for the attainment of male children (paternal specialization on sons). However, maternal specialization (on daughters) seems to have appeared only for cohorts born after 1955. We interpret these results as evidence that fathers are more important role models for sons while mothers are a more important reference for daughters. We argue that our results are robust to the presence of hereditary unobserved ability and conjecture that both types of gender specialization may have been present in earlier cohorts too.Ability, Gender, Human capital, Educational Economics

Immigration and the Political Economy of Public Education: Recent Perspectives

This paper reviews the recent literature on the effects of immigration on the public education of the host country, emphasizing the political economy implications. In particular, we are interested on what happens to enrollment in public schools and the quality of education in these schools. Our review of the literature, which includes both quantitative and empirical studies, suggests the following conclusions. First, immigration has triggered native flight toward private schools in a wide variety of contexts. Some studies also find that the households that switch to private schools tend to be those with higher socio-economic status. Secondly, because of these changes in school choices, one consequence of large-scale immigration is that it appears to undermine the political support for public education, resulting in a deterioration in the funding and quality of public schools that seems to affect negatively the educational outcomes of disadvantaged native students. We offer some suggestions for policies that might help mitigate the negative consequences of immigration outlined above so that host countries can maximize the overall economic benefits of immigration