Level Of Investment In Human Capital Research Articles

Minimum wage standard adjustment and employment: Heterogeneity effects on the human capital investment

Considerable debate has arisen around the potential effects of increasing the minimum wage on employment. This study aims to analyze the impact of changes in China's minimum wage standard on employment. The research utilises the canonical model method and constructs a regression model based on standard labor economics theory. The analysis is conducted using sample data from Chinese industrial enterprises between 2000 and 2007. Regression analysis is performed by categorizing enterprises based on their level of human capital investment. The findings indicate that minimum wage increases have a non-linear impact on employment, when seen from the standpoint of human capital investment. When the level of human capital investment is low, an increase in the minimum wage standard leads to a decrease in employment; when the level of human capital investment is high, an increase in the minimum wage standard leads to an increase in employment. According to the findings, the reason for this is that, investments in human capital can improve business profitability, increase worker marginal productivity, and increase labor demand. Similarly, the employment effect of a change in the minimum wage is positive in regions with high levels of human capital investment due to the externality effect of human capital. Adjustments to the minimum wage have a negative impact on employment in areas of the country with low levels of human capital investment. This demonstrates that changing the minimum wage does not result in a simple increase or decrease in total employment. The level of investment in human capital within the organization and the region is an important factor in determining the type and magnitude of the impact.

Technological innovation on economic growth from the perspective of investment-oriented environmental regulations: considering the threshold effect of China human capital

ABSTRACT An investment-oriented environment and its regulations are the inevitable background when major economies face investment-driven economic development. While technological innovation helps form a compensatory or cost-based development path for economic growth, human capital plays a regulatory role in this development path as the largest dynamic and unstable variable. This research thus conducts a regulatory framework with an empirical study of the threshold effect from different levels of human capital investment on technological innovation and economic growth in four industries. The main conclusions are as follows: 1)We divide technological innovation caused by investment-based environmental regulation into active technological innovation.Passive technological innovation and subsequently identify the quantitative change effect of technological innovation on economic growth under investment-based environmental regulation. 2)Taking the human capital of different industries as threshold variables, we examine the threshold effect of investment-based environmental regulations and confirm the threshold value of different industries. 3)Through lagging second-order stability analysis, we basically solve the endogenous problem of investment-based environmental regulations, in which the relevant estimation conclusions appear more robust. Lastly, this research offers corresponding policy recommendations.

The Role of the Middle Class in Economic Development: What Do Cross-Country Data Show?

This paper investigates the channels through which the middle class may matter for consumption growth and development. Determinants of the size and the growth of the middle class are also examined. Using several different middle class measures and a panel of 72 developing countries spanning the period 1985-2006, we find that a larger middle class influences growth primarily through higher levels of human capital investment. We also find that large governments, higher levels of urbanization, greater democracy, ethnic concentration, and sea access are all associated with a larger middle class.

Estimates of Human Capital in Canada: The Lifetime Income Approach

This paper produces an estimate of market-based human capital investment and stock for Canada over the period from 1970 to 2007 based on the lifetime income approach and compares it with that of physical and natural capital investment and stock. It adopts the methodology developed by Jorgenson and Fraumeni, and estimates human capital stock as the expected future lifetime income of all individuals. Human capital investment is estimated as changes in human capital stock due to the addition of new members of the working age population arising from the rearing and education of children and the effect of immigration on human capital.The main findings are as follows: 1. The volume of aggregate human capital rose at an annual rate of 1.7% in Canada for the period 1970 to 2007, and most of the growth is due to the increase in the number of individuals in the working-age population. The rising education level of the Canadian population is also a significant contributing factor to the growth in human capital. 2. The compositional effects of aging of the Canadian population (a movement to a population that is older on average) reduced human capital growth by 0.6% per year over the period 1980 to 2007, while the rising education level increased human capital growth by 0.7% per year over the period. 3. Human capital stock on a per capita basis increased at 0.9% per year for the period 1970 to 1980, due to the rising education attainment during the period. After 1980, human capital stock per capita was virtually unchanged due to two offsetting factors: rising education level which increased human capital stock and the compositional effects of population aging, which reduced human capital stock. 4. The value of human capital investment and stock exceeds the value of physical capital investment and stock, and the ratio of human capital investment and stock to physical capital investment and stock declined over time. In 2007, human capital stock is about four times as large as physical capital stock while investment in human capital is about two times the magnitude of investment in physical capital. 5. The levels of human capital investment and stock estimates are sensitive to the assumptions made about expected future income growth and the rate used to discount the future income when calculating human capital, but the growth of the quantity and price of human capital investment and stock is not sensitive to the assumptions in these areas

A comparison of human capital levels and the future prospect of the nanotechnology industry in early sector investors and recent emerging markets

Nanotechnology has the potential to create immense economic growth in the future for developed and developing countries. Given that nanotechnology and the industrial processes require a high level of human capital investment there are concerns that the benefits may not be attainable by all countries. Emerging markets like China and South Korea are rapidly developing their nanotechnology sectors as evidenced by the increasing monetary investments, educational investment and the number of nanotechnology related patents over time. This paper investigates the relationship between human capital levels and nanotechnology development by: 1) determining the numbers of graduates in the field of science and engineering; 2) nanotechnology outputs measured by the number of patents. The analysis shows human capital plays a role in the future prospects of both early nanotechnology investors (USA and Japan) and recent emerging markets (China and South Korea).

Why Do Women's Wages Increase So Slowly Throughout Their Career? A Dynamic Model of Statistical Discrimination

Abstract. The aim of this paper is to explain the growing wage differentials between men and women during their working careers. We provide a dynamic model of statistical discrimination, which integrates specific human capital decisions: on‐the‐job training investment and wages are endogenously determined. We reveal a small wage differential at the beginning of women's career, but women's wages increase more slowly; this is partly due to a lower level of human capital investment by women and partly because firms smooth training costs between different periods.

Why Do Women's Wages Increase So Slowly Throughout Their Career? A Dynamic Model of Statistical Discrimination

The aim of this paper is to explain the growing wage differentials between men and women during their working careers. We provide a dynamic model of statistical discrimination, which integrates specific human capital decisions: on-the-job training investment and wages are endogenously determined. We reveal a small wage differential at the beginning of women's career, but women's wages increase more slowly; this is partly due to a lower level of human capital investment by women and partly because firms smooth training costs between different periods.

Human capital investment and debt constraints

When young individuals face binding debt constraints, their human capital investments will be insufficiently financed by private creditors. If generations overlap, then a well-designed fiscal policy may be able to improve human capital investments by replacing missing capital markets with an intergenerational transfer scheme. The optimal (balanced budget) fiscal policy in this context entails the joint provision of an education subsidy for the young and a pension program for the old, financed with a tax on those in their peak earning years. We demonstrate, however, that the desirability of such a cradle-to-grave policy depends crucially on the assumption of an exogenous debt constraint. If debt constraints arise endogenously for reasons of limited commitment, then the optimal (balanced budget) fiscal policy looks radically different. Furthermore, we find that cradle-to-grave type policy interventions may actually lead to lower levels of human capital investment as altered default incentives induce private creditors to contract the supply of student loans by an amount greater than the subsidy. In some cases, the constrained-optimal policy entails zero intervention. These results highlight the importance of taking seriously the reasons for why debt constraints exist.

Education Policy and Mobility: Some Basic Results

This paper analyzes regional public education policy in the presence of mobile workers. Labor market integration leads to fiscal competition, shifting the whole burden of taxation to immobile workers. In the case of mobile skilled workers, this results in income inequalities and inefficient low investment in human capital. This is even more pronounced if politicians are partly self-interested. In contrast, if unskilled workers are mobile, all households receive the same net earnings. In this scenario, a benevolent government ensures an efficient level of human capital investment, while partly selfish politicians choose to invest too little in education.

Investment, Moral Hazard, and Occupational Licensing

I analyse occupational licensing as an input regulation that requires minimum levels of human capital investment by professionals. By raising professionals' training levels, licensing helps alleviate moral hazard problems associated with the provision of high quality services. I also consider certification, whereby consumers are provided information about professionals' training levels. I show that licensing and certification tend to benefit consumers who value quality highly at the expense of those who do not. Licensing may raise total surplus if sellers' investments are not observable, but is Pareto-worsening if training levels are observable. Certification may, however, lead to excessive investment as a signalling device, and thus be Pareto Inferior to either licensing or to a policy of laissez-faire.