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HUMAN CAPITAL DISTRIBUTION, GROWTH AND TRADE
Author(s) -
Lee ChengTe,
Huang DengShing
Publication year - 2014
Publication title -
bulletin of economic research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.227
H-Index - 29
eISSN - 1467-8586
pISSN - 0307-3378
DOI - 10.1111/j.1467-8586.2012.00442.x
Subject(s) - kurtosis , submodular set function , economics , diversity (politics) , distribution (mathematics) , human capital , consumption (sociology) , production (economics) , capital (architecture) , microeconomics , production function , function (biology) , econometrics , mathematics , statistics , market economy , combinatorics , mathematical analysis , geography , archaeology , evolutionary biology , sociology , anthropology , biology , social science
ABSTRACT Distribution differences in human capital matter for a country's growth and trade. While the existing literature considers only the diversity difference in talent distribution, we argue that the kurtosis difference is also an important factor. In a two‐sector equilibrium growth model, where the production function is supermodular for the consumption‐good sector and submodular for the R&D sector, we prove that the diversity effect and kurtosis effect are opposite to each other. A country endowed with more diverse but leptokurtic talent distribution may have lower growth rate and import submodular goods, opposite to the conventional result from considering only the diversity difference.