This article examines how to treat human capital -- perhaps the vast majority of the capital stock -- under an ideal, Haig-Simons income tax. Innate ability, investments in human capital, and uncertainty in future earnings are considered. It is demonstrated that conventional income tax treatment...

The effect of evaluation on employee performance is traditionally studied in the context of the principal-agent problem. Evaluation can, however, also be characterized as an investment in the evaluated employee's human capital. We study a sample of mid-career public school teachers where we can...

We exploit a natural experiment to estimate the causal impact of parental education on educational outcomes of their children when they are high school seniors. In 1968, the Taiwanese government extended compulsory education from 6 to 9 years and opened over 150 new junior high schools at a...

Firms in the same industry can differ in measured productivity by multiples of 3. Griliches (1957) suggests one explanation: the quality of inputs differs across firms. We add labor market history variables such as experience and firm and industry tenure, as well as general human capital...

This paper develops a human capital measure in the sense of Schultz (1960) and then reevaluates the contribution of human capital to China's economic growth. The results indicate that human capital plays a much more important role in China's economic growth than available literature suggests,...

Existing growth research provides little explanation for the very large differences in long-run growth performance across OECD countries. We show that cognitive skills can account for growth differences within the OECD, whereas a range of economic institutions and quantitative measures of...

We combine data from a field experiment and a laboratory experiment to measure the causal impact of human capital on respect for earned property rights, a component of social preferences with important implications for economic growth and development. We find that higher academic achievement...

This paper examines whether the Solow growth model is consistent with the international variation in the standard of living. It shows that an augmented Solow model that includes accumulation of human as well as physical capital provides an excellent description of the cross-country data. The...

A central organizing framework of the voluminous recent literature studying changes in the returns to skills and the evolution of earnings inequality is what we refer to as the canonical model, which elegantly and powerfully operationalizes the supply and demand for skills by assuming two...

We develop a macroeconomic model with physical and human capital, human capital risk, and limited contract enforcement. We show analytically that young (high-return) households are the most exposed to human capital risk and are also the least insured. We document this risk-insurance pattern in...