This paper studies second best policies for education, saving, and labour in an OLG model in which endogenous growth … equilibria are inefficient. The inefficiency is exacerbated if selfish individuals externalize the positive effect of education … on descendents' productivity. It is shown to be second best to subsidize education even relative to the first best if the …

A core mechanism of unified growth theory is that accelerating technological progress induces mass education and, in … technological progress on investments in education and a strongly negative one on fertility. Using two-stage regressions, we assess …