Measuring aggregate human capital in Portugal. An update up to 2001

Recent studies conclude that human capital should be a high priority because it is a key growth input, particularly in an increasingly knowledge based economy and an important lever of social cohesion policy. However, existing studies focusing on cross-country growth performance have produced opposing results. Several researchers argue that these conflicting results derived from poor quality data used in some of those studies. They further acknowledge that main reason for the use of poor proxies of the stock of human capital is that in most empirical growth studies, the choice of the human capital proxy is hardly reflected upon and depends very much on data availability. This paper updates Teixeira’s (1998) estimation of the stock of human capital for the Portuguese economy up to 2001 providing an improved proxy for human capital stock based on education attainment. This work might potentially facilitate further empirical works on the relation between human capital and long-term economic growth.