Abstract
This paper considers the relation of education and of scientific and technical knowledge developed through R&D to labor productivity growth within the medium term. It is unique in using a total capital approach that includes both private and public physical, human, and knowledge capital formation and in use of a medium term model for determining productivity growth that includes both demand side and supply side effects. Empirical results for the U.S. and 14 other major OECD nations for 5-yr time periods from 1955 through 1980 find education as measured both by the average educational attainment of the labor force and by the percentage of advanced level graduates who bring technology to bear on production to be significant determinants of productivity growth. Gross investment in physical capital also transmits the R&D and has a positive influence, as do higher utilization rates and the technology transfer associated with lower initial productivity levels.
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