Measuring human capital in the labor market: The supply of experience in 8 OECD countries

To investigate the evolution of the supply side of the labor market, I derive a methodology to measure an important component of the human capital level of the workforce, the experience of the labor market. Based on the perpetual inventory method, a stock of experience is estimated for eight OECD countries. It appears that, during the last three decades, the OECD labor markets have faced a decline in the supply of experience by the labor market participants, with a minimum in the early 1980s for most countries and a recovery in the 1990s. Some implications regarding relative wages, relative unemployment and schooling are discussed.     

China's Recent Economic Performance and Future Prospects*

Our forecast of China's economic future is based primarily on the supply side growth accounting model. The life cycle model of household saving provides us with the most plausible explanation for a continued high rate of savings and investment. China's labor force will soon stop growing, but migration out of agriculture should have little impact on farm output while providing a steady stream of labor to the modern more productive sectors. There is also room for rapid expansion of human capital. Maintaining high productivity growth will depend primarily on strengthening currently weak institutions, notably the financial sector and, more importantly, the legal system.     

全要素生产率与中国经济增长关系研究——基于VAR模型视角

运用TFP的变动来对经济增长潜力展开分析,是国内外经济学界的常见研究思路。从新古典模型出发,对改革开放以来的中国TFP进行估算分解,并构建TFP、GDP增长、资本增长和劳动力增长之间的VAR模型。实证研究认为,目前中国已进入跨越式发展时期,应大力发展资本市场,促进资本要素的有效流动,促进产业结构优化,将提高劳动力受教育水平作为重要发展战略,注重进行技术基础的革新,提高经济增长质量,促进经济发展方式向集约型发展方式转变。     

Human capital heterogeneity of the unemployed and jobless recoveries

The jobless recovery enigma remains largely unsolved. As a special case of broader unemployment, the term “jobless recovery” describes an economic recovery where output recovers—and even expands—yet employment growth remains anemic. While the effects of these prolonged recoveries are significant—from increased crime to a lifetime reduction in wages—they are not well understood. Building on the insights of labor market matching models that incorporate heterogeneity among workers, this paper sheds light on jobless recoveries, developing a first-of-its-kind index of human capital heterogeneity for the unemployed, and testing that index using of a Structural Vector Autoregression. I demonstrate that the extent to which unemployed human capital is heterogeneous and specific, rather than homogeneous and general, plays a key and under-appreciated role in the labor market; increases in human capital heterogeneity can account for between one-quarter to three-quarters of the joblessness of the past three recoveries in the pre-COVID era.     

Skills,sunspots and cycles

This paper explores the ability of a class of one-sector, multi-input models to generate indeterminate equilibrium paths, and endogenous fluctuations, without relying on factors’ hoarding. The model presents a novel theoretical economic mechanism that supports sunspot-driven expansions without requiring upward sloping labor demand schedules. Its distinctive characteristic is that the skill composition of aggregate labor demand drives expansionary i.i.d. demand shocks. Next, the model explains the labor market dynamics from the supply side, while endogenizing the capital productivity response to changes in the aggregate labor demand composition. Last but not least, it is worth to mention that the model presents an effective shock propagation mechanism that operates into the labor market and across labor market segments through the cross elasticities of equilibrium labor demand and supplies.      

Human capital and economic growth: A macroeconomic model for Pakistan

The paper presents a small macro model for Pakistan economy focusing the impact of investment in human capital on the key macroeconomic variables. The demand side is modeled along the Keynesian lines while the supply side is modeled as per neoclassical theory of production. This framework allows analyzing the effects of investment in human capital on supply side variables (like labor, physical and human capital) and demand side variables (like consumption and investment) at the same time.The model has small forecasting horizon in which three alternative scenarios regarding government spending on education are evaluated from 2012 to 2016. The model shows that the link between human capital and labor market is weak however a change in education spending affects output through enhancing productivity and through multiplier-accelerator principle. Though the model is small in size and forecasting horizon, it can help in evaluating the future paths of key macroeconomic variables associated with education spending.     

Child Gender,Intergenerational Kinship and Parental Labor Market Outcomes

This paper provides new evidence of the effects of child gender on parental labor market outcomes. Using data from the China Health and Nutrition Survey, I document a son premium on the intensive margin of parental labor supply in two‐parent families with one child. Parents with a newborn to a 6‐year‐old son have higher labor supply than parents with a daughter in the same age group. A further examination indicates that boys are likely to have better access to grandparent‐provided childcare than girls owing to grandson preference, and this allows parents with a preschool‐aged son to work more. The intensification of market work associated with having a son may affect economic outcomes over the lifecycle of parents through labor market attachment. This paper thus sheds light on the important distributional effects of family ties and culture on economic outcomes.     

Immigration, fertility, and human capital: A model of economic decline of the West

I show how the influences of unskilled immigration, differential fertility between immigrants and the local indigenous population, and incentives for investment in human capital combine to predict the decline of the West. In particular, indigenous low-skilled workers lose from unskilled immigration even if the indigenous low-skilled workers do not finance redistribution, do not compete with immigrants in the labor market, and do not compete with immigrants for publicly financed income transfers. For the economy at large, high-fertility unskilled immigrants and a low-fertility indigenous population result in economic decline through reduced human capital accumulation and reduced growth of per-capita output.     

Economic-demographic interactions and the impact of investments in population control

The interaction between economic and demographic factors in the Philippines was examined, analyzing the effects of investment in fertility control on the birthrate, population size, and such economic variables as gross national product (GNP), wage rate, and family income. A family planning model that was constructed and is used to project population program cost and births prevented is grafted to and simulated with a larger economic/demographic model. The simulation results are anayzed. The economic demographic model to which the family planning subsystem was grafted is a modified version of the model constructed by Encarnacion et al. (1974). It is basically a neoclassical model, a closed economy in which the real wage rate is determined by the intersection of the demand and supply of labor. The demand for labor is derived from a Cobb-Douglas production function on the assumption that labor is paid the value of its margin product, and the labor supply is determined by age and sex specific labor force participation rates and population. Capital accumulation is influenced by population size through its effect on government and private consumption expe nditures. Fertility rate is determined by duration of marriage and the level and distribution of family incomes. The model was used to develop projections from 1970 through 2000. Results show that the effects on per capital income and real wage rate seem significant, yet family income appears largely unaffected and the effect on the traditional investment to output ratio (I/Y) seems minimal. One of the outcomes of the projection without family planning is that, if the economy were to depend solely on its own savings, the average annual rate of growth of gross national product (GNP) would be only about 4.32%, which is less than the historical growth rate of 6% and the present government longterm target of 8%. The result suggests that foreign investments and loans would have to play an increasingly important role in the economic growth of the Philippines unless the gross domestic investment of GNP ratio is increased substantially. Aggregate output is reduced due to a relatively smaller labor force. Thus, it is suggested that if population control programs are accompanied by an increase in the labor participation rate, particularly of women, the payoffs from family planning may be larger. Closer examination of the nature of the payoffs from the family planning program would reveal that they basically stem from the decrease in the number of persons sharing in national output and not from increased production and saving. The observation suggests that population control does not necessarily lead to more rapid economic growth defined as sustained increase in total output.     

Growth effects of a revenue-neutral environmental tax reform

This paper analyzes tax-policy measures within a two-sector endogenously-growing economy with elastic labor supply. Pollution is either modeled as a side product of physical capital used as a production factor in the final-good sector or as a side product of production. The framework allows us to analyze the consequences of isolated tax changes or of a revenue-neutral environmental tax reform for economic growth. Although pollution does not directly affect production processes, it can be shown that a higher pollution tax as well as a revenue-neutral environmental tax reform boost economic growth, whereas a tax on capital, consumption, or labor reduces the long-term growth rate of the economy.     

Optimal income taxation in models with endogenous fertility

This paper studies the efficient taxation of factor income in infinite-lived models with elastic fertility choices. Two models are considered, one with physical capital only, and one with physical and human capital. In the model with physical capital only, capital income should be subsidized, while labor income taxed. In the model with two types of capital, instead, Ramsey optimality prescribes that the tax on physical capital is zero (negative), if effective labor is constant (decreasing) returns to scale in human capital and market goods, while the tax on human capital is negative and the tax on effective labor positive. Our findings depart from those obtained in immortal models with an endogenous labor supply and constant population growth, because physical and human capital affect the demand for fertility.     

从要素市场化看供给侧改革的中长期实践路径*——基于随机前沿模型增长核算的分析

本文从要素市场化角度分析中国供给侧改革的中长期实践路径。从经济增长核算的角度出发,本文基于2005—2013年全国分省面板数据,通过超越对数生产函数形式的随机前沿模型测算经济增长来源并分解全要素生产率,发现TFP是非农经济增长的主要来源。然而TFP分解中技术效率偏低,且逐年下降,成为阻碍TFP增长以及经济增长的一大桎梏,而要素市场扭曲是技术效率项偏低的重要原因。促进要素市场化能够推进要素向高效企业流动,进而提高社会整体生产效率水平,本文认为,这是中国供给侧结构性改革的中长期实践路径。     

新冠肺炎疫情的经济影响分析：长期视角与短期应对*

本文从需求和供给两侧分析了此次新冠疫情对我国经济的短期和长期影响。在需求侧,基于理论分析和非典疫情对经济的影响特征,经济总需求会随着此次疫情的结束而在短期内快速得到恢复。但此次疫情也会加大总需求和居民收入增速的下行压力。在供给侧,疫情不仅会降低劳动力资源配置效率,加剧劳动力供需结构矛盾,同时也大幅降低了我国的资本投资,在缺乏有效干预措施下,很可能加剧我国资本投资和经济总体增速的短期下滑趋势。而基于理论分析,相应供给冲击也将对我国长期产出带来增长压力。基于疫情对我国经济需求侧和供给侧的影响分析,2020年要实现全面建成小康社会的经济目标需要实施改革力度更大、更为有效的财政和货币等支持政策。     

我国人力资本投资对经济增长的贡献

本文在对人力资本与经济增长的文献综述的基础上,利用我国统计年鉴中有关经济、教育数据计算我国人力资本存量与物质资本存量,并利用有效劳动模型和人力资本外部性模型,估计我国人力资本对经济增长的贡献,发现在我国经济增长过程中,物质资本存量的作用更为关键,而且人力资本投资对经济增长的外部性作用明显。     

新冠肺炎疫情的经济影响分析：长期视角与短期应对*

本文从需求和供给两侧分析了此次新冠疫情对我国经济的短期和长期影响。在需求侧，基于理论分析和非典疫情对经济的影响特征，经济总需求会随着此次疫情的结束而在短期内快速得到恢复。但此次疫情也会加大总需求和居民收入增速的下行压力。在供给侧，疫情不仅会降低劳动力资源配置效率，加剧劳动力供需结构矛盾，同时也大幅降低了我国的资本投资，在缺乏有效干预措施下，很可能加剧我国资本投资和经济总体增速的短期下滑趋势。而基于理论分析，相应供给冲击也将对我国长期产出带来增长压力。基于疫情对我国经济需求侧和供给侧的影响分析，2020年要实现全面建成小康社会的经济目标需要实施改革力度更大、更为有效的财政和货币等支持政策。     

Population dividend and economic growth in China, 1978–2018

ABSTRACT

China witnessed important demographic transitions during the past 40 years. The significant decline in fertility rate, as a result of both policy change and economic factors, generated the so-called population dividends – rising proportion of working age population – during the past several decades. This paper demonstrates important channels through which broadly defined population dividends contribute to economic growth in China, by magnifying roles of capital, by improving labor quality, alongside increases in labor supply, and by strengthening labor mobility. As population aging now takes over from population dividends as the main demographic trend, it is possible for China to continue its strong growth by focusing on both the traditional growth factors, such as further reducing the proportion of agricultural workers, and new growth factors, such as further improving productivity by strengthening human capital and weakening institutional obstacles.     

Human capital,externalities and growth in an overlapping generations model

We consider an overlapping generations model with endogenous labor supplies by young and old and a human capital accumulation process that relies on the interaction of these two types of labor. This interaction is not understood by the market hence we analyze fiscal policies designed to remedy this. We argue that taxes must be acceptable to people alive at the time of planning. This makes many proposed taxes unfeasible. Two distinct paths to growth emerge; one through increased savings and another through increased workforce participation. The long run rate of growth depends entirely on human capital but we find this to be of little relevance. Some simulation results are presented for two stylized economic blocks calibrated on the USA and the EURO-zone.     

Recent developments in China's labor market: Labor shortage,rising wages and their implications

China's abundant supply of cheap labor has played an important role in its remarkable economic and social development. Recently, however, China has experienced a labor shortage and rising wages, implying that the country's long‐lasting competitive advantage based on its “unlimited” labor supply and low costs is vanishing. We find that structural demographic changes, regional economic growth disparities and the household registration system may have caused the labor shortage. Furthermore, China's continued low wages, relatively low labor share of gross national income, declining proportion of household consumption to GDP , and productivity improvements as well as increasing unit labor costs can be used to explain the recent wage increases. The dramatic development of its labor market signals that China is entering a new stage of economic development. The country's prior successful model of economic development needs to be adjusted to adapt to the new situation in its labor market to achieve sustainable economic development.     

Some reflections on the growth of female labour supply and the tertiary sector

The economic literature on female participation in the labour market concentrates mainly on microeconomic supply decisions based on economic variables (wage rates, family income, human capital etc.) and maximization under external constraints (marriage, children), and on structural (demand) influences stemming from a growing service sector. The influence of non-economic cultural factors (‘feminist revolution’) is frequently mentioned but is usually treated - if at all - as a time trend. In the present paper difference in religious denominations are taken as a proxy for different feminist attitudes and are used in a cross-section analysis of 15 European countries. It is shown that a consideration of this factor has a significant effect on parameter values and on the perspective in which the growing share of women in total employment can be seen.     

Social classes,demographic transition and economic growth

This paper analyzes the role of the demographic transition in the emergence of sustained economic growth, and shows that these two processes are related. Unlike previous contributions which have focused on the importance of human capital, this paper suggests that capital accumulation, and the existence of different social classes may provide an alternative explanation for the observed pattern of output, fertility rates and wages during the 19th century. The framework presented shows that during the first phase of industrialization, a decline in capital–labor ratio reduces the wage rate and increases the dependency of the family unit on child labor, increasing fertility rates. However, in later phases the increase in the capital–labor ratio, due to the saving of the business elite, reduces the necessity of child labor bringing about the demographic transition.