Human capital misallocation, redistributive policies, and TFP

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Show simple item record Bandyopadhyay, Debasis en King, I en Tang, X en 2020-04-08T02:31:47Z en 2019-06 en
dc.identifier.issn 0164-0704 en
dc.identifier.uri en
dc.description.abstract We analyse the impact of human capital misallocation and redistribution on GDP, welfare, and TFP, in economies with financial market imperfections. We present an overlapping generations model in which the innate abilities of children are drawn from a probability distribution and where parents are unable to insure against these shocks or borrow against their child’s future incomes. The government has access to a redistributive tax and transfer system that can partially mitigate the effects of these missing markets. The steady state equilibrium of the model features closed form analytical solutions for the distributions of human capital, physical capital, and income, along with aggregate measures of TFP and welfare. We calibrate the model to the US economy and find that the misallocation, and its adverse effects on TFP and GDP, can be significant. However redistributive policies, aimed at mitigating the misallocation from these missing markets, have only small positive effects on TFP but large negative effects on GDP. en
dc.publisher Elsevier en
dc.relation.ispartofseries Journal of Macroeconomics en
dc.rights Items in ResearchSpace are protected by copyright, with all rights reserved, unless otherwise indicated. Previously published items are made available in accordance with the copyright policy of the publisher. en
dc.rights.uri en
dc.title Human capital misallocation, redistributive policies, and TFP en
dc.type Journal Article en
dc.identifier.doi 10.1016/j.jmacro.2019.02.005 en
pubs.begin-page 309 en
pubs.volume 60 en
dc.rights.holder Copyright: The author en
pubs.end-page 324 en
dc.rights.accessrights en
pubs.subtype Article en
pubs.elements-id 773673 en Business and Economics en Economics en
pubs.record-created-at-source-date 2019-06-04 en 2019-03-12 en

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