Abstract
We relate the negative correlation between income and the ratio of high to low-tech human capital and the positive correlation between income and investment on R&D, both present in developed countries, to the transition to a services economy. To this end a growth model with endogenous innovation and accumulation of high-tech and low-tech human capital is developed. We consider a negative effect of technological development on the accumulation of high-tech human capital and that services are relatively intensive in low-tech human capital. We confirm the model implications quantitatively in a calibration exercise.
Original language | English |
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Article number | 12 |
Journal | Topics in Macroeconomics |
Volume | 6 |
Issue number | 1 |
Publication status | Published - 25 Oct 2006 |
Keywords
- High-tech human capital
- Human capital composition
- R&D
- Services