HUMAN CAPITAL AND CONVERGENCE: A PRODUCTION-FRONTIER APPROACH

Using nonparametric, production-frontier methods, we decompose labor productivity growth into components attributable to technological change (shifts in the world production frontier), technological catch-up (movements toward or away from the frontier), and physical and human capital accumulation (m...

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Bibliographic Details
Published in:International economic review (Philadelphia) 2005-11, Vol.46 (4), p.1167-1205
Main Authors: Henderson, Daniel J., Russell, R. Robert
Format: Article
Language:English
Subjects:
Contrafactuals
Economic theory
Efficiency metrics
Emerging technology
Employee efficiency
Growth models
Human capital
Macroeconomics
Production efficiency
Production functions
Productive efficiency
Productivity
Structural capital
Studies
Technological change
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Summary:Using nonparametric, production-frontier methods, we decompose labor productivity growth into components attributable to technological change (shifts in the world production frontier), technological catch-up (movements toward or away from the frontier), and physical and human capital accumulation (movements along the frontier). We find that (1) technological change is decidedly nonneutral, (2) productivity growth is driven primarily by physical and human capital accumulation, (3) the increased international dispersion of productivity is explained primarily by physical capital accumulation, and (4) international polarization (the shift from a unimodal to a bimodal distribution) is brought about primarily by efficiency changes (technological catch-up).
ISSN:0020-6598
1468-2354
DOI:10.1111/j.1468-2354.2005.00364.x