Using a dynamic augmented Solow model, I estimate the effect of students’ schooling attainment, schooling expenditures, and students’ test scores on growth rates over the period 1985-2005. I also estimate the effect of related measures for human capital stocks on national income in a static...

I use a dynamic Solow growth model, augmented with human capital, labor-hours, and oil prices, to show that Japan’s growth in GDP/adult over 1969-2007 can be explained as a process of convergence to a world steady-state rate of 1%/year. I find that each additional year of average schooling...

This article presents revised estimates of the external rates of return on investment in schooling provided in “Schooling and National Income: How Large Are the Externalities?” The analysis is based on data for the same set of countries, but it incorporates methodological improvements that...

In 1960 Theodore Schultz expounded a human capital theory of economic growth that includes three elements: 1) Countries without much human capital cannot manage physical capital effectively, 2) Economic growth can only proceed if physical capital and human capital rise together, and 3) Human...

This paper challenges Hanushek and Woessmann’s [2008] contention that the quality and not the quantity of schooling determines a nation’s rate of economic growth. I first show that their statistical analysis is flawed. I then show that when a nation’s average test scores and average...

Annual growth in GDP/adult in Japan has declined from over 10% in 1969 to an average of 1% since the financial crisis in 1991. I show that a dynamic Solow growth model, augmented with human capital, weekly labor-hours, and oil prices, explains Japan’s annual growth rates from 1969 to 2007 as...

Using firm-level data from 2006 to 2013 for a set of developing countries, we examine the effects of financial development on innovation. Financial development boosts innovation by improving resource allocation and investment toward strategic sectors as well as facilitating technology to promote...

This paper explains why different studies present widely-varying estimates of the effect of increased schooling on national income. It shows that when correctly-interpreted, these studies support the hypothesis that a one-year increase in average schooling attainment raises national income...

Students´ test scores at ages 9 to 15 are a measure of their skills as workers five to 55 years later. Using historic data on test scores and school attendance, I calculate the share of workers in 2005 that could have scored above 400 and above 600 in 45 countries. I find that the share above...

Using a new data set for human capital/adult, I show that changes in human capital cause economic growth in 56 countries over the 1985 to 2005 period. I show that these results are superior to results using average schooling attainment.