The Knowledge Trap: Human Capital and Development Reconsidered / Benjamin F. Jones.

Format:

Book

Author/Creator:

Jones, Benjamin F.

Contributor:

National Bureau of Economic Research.

Series:

Working Paper Series (National Bureau of Economic Research) no. w14138.

NBER working paper series no. w14138

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

The Knowledge Trap

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2008.

Summary:

This paper presents a model where human capital differences - rather than technology differences - can explain several central phenomena in the world economy. The results follow from the educational choices of workers, who decide not just how long to train, but also how broadly. A "knowledge trap" occurs in economies where skilled workers favor broad but shallow knowledge. This simple idea can inform cross-country income differences, international trade patterns, poverty traps, and price and wage differences across countries in a manner broadly consistent with existing empirical evidence. The model also provides insights about the brain drain, migration, and the role for multinationals in development. More generally, this paper shows that standard human capital accounting methods can severely underestimate the role of education in development. It shows how endogenous educational decisions can replace exogenous technology differences in a range of economic reasoning.

Notes:

Print version record

June 2008.