Human Capital: Education and Health in Economic Development

1
Human Capital Education and Health in Economic
Development

• Chapter 8

2
Human Capital Investments in Health and
Education Raise Incomes and Well-Being
Age-earnings profiles by education level in
Venezuela
3
Wealth and Health Infant and Adult Mortality in
Poor and Nonpoor Neighborhoods of Porto Alegre,
Brazil, 1980
4
Height as a Proxy for Health
5
Wages, Education, and Height of Males in Brazil
and the United States
6
Education and Health as Investments
Invest in Ed if NPV of higher earnings net of
costs is positive (note importance of capital
markets, ability to self-finance)
7
Private versus Social Benefits and Costs of
Education
8
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9
The Gender Gap Women and Education

• Young females receive less education than young
  males in nearly every LDC
• Benefits of closing this educational gender gap
  (why?)
• Lower fertility
• Higher child health and survival
• Quality of life

10
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11
Effects of Male Bias Female-Male Ratios in Total
Population in Selected Communities
12
Educational opportunity and Economic Growth
Lorenz curves for India and Korea, 1990
13
Economic Growth and Income Inequality A Human
Capital Approach

• Use 2-sector model with low-skilled (illiterate)
  and high-skilled (literate) labor to explain
  facts about growth, labor migration and income
  distribution
• Higher poverty in rural areas
• High rates of labor migration
• Persistent unemployment or under-employment in
  urban areas