The Human Capital Stock: A Generalized Approach: Reply
American Economic Review · 2019 · Volume 109 · Issue 3
Abstract
Human capital differences across countries can appear large or small depending on measurement methods. This Reply clarifies key assumptions and conceptual distinctions across accounting approaches. Accounting-based arguments for small human capital differences are difficult to sustain. By contrast, large human capital differences are theoretically and empirically coherent. Non-accounting arguments against large human capital variation are examined and their weaknesses pinpointed. This Reply also suggests a fruitful way forward for this literature, providing a natural conception of human capital that integrates literatures on ideas and institutions with the accounting of Jones (2014).
Keywords
Employment, Unemployment, Wages, Intergenerational Income Distribution, Aggregate Human Capital, Aggregate Labor Productivity, Returns to Education, Human Capital, Skills, Occupational Choice, Labor Productivity, Wage Level and Structure, Wage Differentials
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