Model Of Capital Accumulation Research Articles

Development of a Career Capital Accumulation Model for Female Engineering College Students Based on Gender

Development of a Career Capital Accumulation Model for Female Engineering College Students Based on Gender

Optimal growth with labor market frictions

AbstractIn this paper, I build a capital accumulation model in which labor has to be alternatively employed in the production of goods or in the recruitment of workers. Within this setting, I show that (i) the intensive measure of capital may converge towards its stationary value in a non‐monotonic manner, (ii) Pareto‐optimal allocations can also be achieved in a decentralized environment in which the wage is indexed to labor market tightness, and (iii) the consistency of the wage that implements efficient allocations with the competitiveness of the market for goods relies on vanishing values of the discount rate.

A mean field game model for COVID-19 with human capital accumulation

In this manuscript, we study a model of human capital accumulation during the spread of disease following an agent-based approach, where agents behave maximising their intertemporal utility. We assume that the agent interaction is of mean field type, yielding a mean field game description of the problem. We discuss how the analysis of a model including both the mechanism of change of species from one epidemiological state to the other and an optimisation problem for each agent leads to an aggregate behaviour that is not easy to describe, and that sometimes exhibits structural issues. Therefore we eventually propose and study numerically a SEIRD model in which the rate of infection depends on the distribution of the population, given exogenously as the solution to the mean field game system arising as the macroscopic description of the discrete multi-agent economic model for the accumulation of human capital. Such a model arises in fact as a simplified but tractable version of the initial one.

Fighting Corruption in Developing Countries to Meet the Challenge of Human Capital Development: Evidence from Sub-Saharan African Countries

This paper provides both theoretical and empirical evidence on the need to consider institutions in human capital development in Sub-Saharan African (SSA) countries. In a model of human capital accumulation with public expenditure where we include a corruption parameter, it is found that when a bureaucrat or any other agent takes away part of the amount allocated to education or health, he reduces the quantity and quality of public services. Moreover, an estimation with the generalized moment method in system on panel data of 35 countries covering the period 1996–2018, the results show on the one hand that corruption manages to reduce the output of education and the average duration of studies and life expectancy of citizens through its negative effect on public spending in the education and health sector. On the other hand, corruption has a direct and negative impact on the performance of education. Indeed, it creates a lack of motivation in learning and in plans to pursue higher education because the return is very low, as is access to health and education services. In addition, corruption also distorts the allocation of public expenditure in favor of military, transport, mining, energy, and fuel expenditure as opposed to health and education expenditure. The effectiveness of governments in combating corruption is fundamental to human capital accumulation in Sub-Saharan African countries.

On the black-white gaps in labor supply and earnings over the lifecycle in the US

In the US economy, Black men, on average, receive lower wages than White men, and the difference increases over the working life. The employment rate and the number of hours worked are also lower for Blacks, but the gap is nearly constant. Together these facts suggest that on-the-job human capital accumulation might explain the diverging wages. However, the wage gap and its evolution over the lifecycle cannot be explained by differences in accumulated experience or educational attainment for the cohort we analyze. Instead, the combination of experience and test scores measured at ages 17-22 accounts for the wage gap and its growth. We propose an on-the-job human capital accumulation model with heterogeneity in the initial human capital endowment and the lifelong ability to accumulate human capital, and endogenous labor supply at the extensive and intensive margins to explain the evolution of the Black-White wage gap over the lifecycle. We discipline the distribution of the ability to accumulate human capital using the power of test scores to predict earnings growth in the data. We find that if the pre-market distributions were the same for Blacks and Whites, the racial gap in hourly earnings would be closed by 84%, with the remaining gap opening throughout life due to higher labor supply amongst White men. That is, the unequal conditions with which men in the two groups enter the labor market are likely to be the key determinant of the differences over the lifecycle.

Sustainable per capita consumption under population growth

We establish two investment rules for maximal constant per capita consumption under exogenous population growth, one in terms of total capital stocks and the other in terms of per capita capital stocks. Both rules show the importance of the development of future population growth. The investment rules are illustrated in the one-sector model of capital accumulation, the DHSS model of capital accumulation and resource depletion, and the Stollery–d’Autume–Schubert model in which natural capital provides amenities. Application to recent empirical evidence indicates that actual genuine savings might be insufficient to sustain per capita consumption, when future population growth is combined with a large per capita consumption-wage gap.

Why Do Financially Illiterate Students Perceive Lower Education Returns? Evidence From a Survey in Rural China

This paper studies how students’ financial literacy affects their perceptions of returns to schooling and consequently their schooling decisions. We first propose a model of human capital accumulation where financially illiterate students exhibit a cognitive bias of “ironing heuristic.” With this decision heuristic, students tend to linearize the relationship between educational investments and future earnings, resulting in underestimated returns to education and inadequate study efforts. Using survey data from four rural middle schools in Southwest China, we then find a positive correlation between financial literacy and students’ perceived returns to education. In particular, the estimate of students’ perceived earnings function shows that its curvature significantly increases with students’ financial knowledge of compound interest, supporting the assumption in the theory. Our findings suggest that promoting students’ financial literacy may be an effective policy to motivate students to learn at school, especially in poor rural areas. JEL: I26, G53 (Financial Literacy), D91, J24

‘We work for the Devil’: Oil extraction, kinship and the fantasy of time on the offshore frontier

In the offshore oil industry of Takoradi, Ghana, white expatriate workers describe oil extraction as both ‘the work of the Devil’ and a ‘labour of love’. While companies strive to produce the offshore as a timeless and spaceless fantasy of ‘frictionless profit’, workers emphasize oil work as a sacrificial economy where risk, loss and distance are traded in the pursuit of an ideal of family life. In this article, I argue that the operational structures and labour regime of the offshore (characterized by a rotation pattern, continuous production, distant locations, a segregated workforce, and mobile installations) create not only a model of capital accumulation, but a mode of being and making kin. I describe oil workers’ aspirations to a ‘good family life’ and parental care, pitting time against distance, and the interpersonal ruins that remain when they fray. In probing how oil workers make petro-capitalism affectively workable, by exploring the entangled processes of extractive and reproductive labour, this article contributes to recent scholarship on the role of kinship in sustaining global capitalism.

On the basis of the Hamilton–Jacobi–Bellman equation in economic dynamics

We consider the classical Ramsey–Cass–Koopmans capital accumulation model and present three examples in which the Hamilton–Jacobi–Bellman (HJB) equation is neither necessary nor sufficient for a function to be the value function. Next, we present assumptions under which the HJB equation becomes a necessary and sufficient condition for a function to be the value function, and using this result, we propose a new method for solving the original problem using the solution to the HJB equation. Our assumptions are so mild that many macroeconomic growth models satisfy them. Therefore, our results ensure that the solution to the HJB equation is rigorously the value function in many macroeconomic models, and present a new solving method for these models.

Invisible (bio)economies: a framework to assess the ‘blind spots’ of dominant bioeconomy models

Bioeconomy as a new promissory discourse neither challenges the paradigm of economic growth, nor questions its embeddedness in capitalist (neo-)colonial patriarchal power relations. However, the calls for a ‘genuine’ socio-ecological transformation and for alternative bioeconomy visions imply exactly a destabilization of these power relations. Drawing on the Bielefeld subsistence approach and on its colonialism–capitalism–patriarchy nexus, I argue that the latest bioeconomy strategy and policy papers of both the EU and Estonia each disregard certain spheres of the bioeconomy due to the three-dimensional power relations. As a seemingly neutral political discourse, the bioeconomy is shaped by cultural assumptions and narratives that determine and perpetuate what is deemed worthy of protection and what is pushed aside as merely ‘natural’. As such, the current bioeconomy papers promote a ‘biomass-based model of capital accumulation’ that is essentially built on the prerequisite of the subordination, devaluation, appropriation and/or exploitation of (1) different geographical regions, (2) ecological foundations, and (3) prevalent bioeconomy practices. As a widespread agricultural practice in Eastern Europe, Food Self-Provisioning (FSP) serves as a good example of how predominant bioeconomy models (1) simply operate as new forms of postcolonial development discourse, instead of embracing the plurality of decolonial ‘alternatives to development’; (2) deepen the human–nature dichotomy by regarding nature as a mere resource to be extracted more efficiently instead of cultivating mutually nourishing partnership-like relation(ship)s with nature; and (3) maintain the separation between monetized and maintenance economies, rather than fostering ethics of care to overcome the structural separation between the latter.

A SINKING EMPIRE

This article pivots around the work of early modern legal scholar Hugo Grotius to consider the political stakes of ontological assessments of the sea and water in the context of Dutch imperialism. It draws on links with land reclamation projects in the Netherlands, while at the same time ties these to urgent questions within contemporary critical water and ocean studies around water, ontology, and race. Suggesting a rethinking of Grotius’s understanding of the ocean as perpetual res nullius – perpetually ownerless property – it destabilizes renditions of Grotius’s free sea as free from ownership. The ocean remains firmly within the orbit of property, the property of mankind, thereby excluding those considered non-human, including racialized, gendered, and more-than-human life forms. Grotius’s mare liberum as perpetual res nullius does not form an exception from territorial, personal, and national conceptualizations of property, but rather preconditions it – preparing the world for its thingification. I examine how this understanding of the ocean and of water has colonized our thinking of the ocean, law, being, and belonging. At the same time, the ocean’s very materiality seems to resist Grotius’s legal narrative. Although Grotius’s conquest of maritime imagination continues to justify global models of capital accumulation, the ocean always already shores up against and spills out of such reductive imaginaries.

A Task-Based Model of Human Capital Accumulation

A Task-Based Model of Human Capital Accumulation

Increasing returns and business cycles in a family of Goodwinian models with Leontiev technology

The main purpose of this paper is to build a family of tutorial Goodwinian (essentially Marxist) models of capital accumulation through industrial cycles that are less complicated than the author’s models of the extended capitalist reproduction in the USA already published. The subordinate purpose is to advance refinement of these models from the standard “neoclassical” assumptions that distort the generic structures determining perpetual disequilibrium in the reproduction of the aggregate social capital. The ascending from abstract to concrete applies the notion of twofold nature of capitalist production as creation of use value and labour value (prioritizing surplus value). This approach reveals substantial facets of endogenous increasing returns and technological progress induced by capitalist production relations. A three-dimensional Goodwinian model L-1, containing the greed feedback loops, reflects destabilizing cooperation and stabilizing competition of investors. Monopoly capital implements proportional and derivative control over the capital accumulation rate. The growth rate of output per worker directly depends on the growth rates of capital intensity and employment ratio in a technical progress function, whereas the capital-output ratio is constant. Oscillations imitating growth cycles are endogenous. A recession (mild crisis) is a manifestation of relative and absolute over-accumulation of capital. A knife-edge limit cycle maintains a growth cycle with the Kondratiev duration; a more solid limit cycle with a period of about 7.5 years upholds a business cycle with a recession without reduced net output. These limit cycles result from the subsequent supercritical Andronov–Hopf bifurcations. The transformation of the growth cycle into industrial cycle gives credit to raising status of capital-output ratio from auxiliary in L-1 to the level (phase) variable in four-dimensional L-2. A mechanization (automation) function mirrors induced technical progress. L-2 embraces new 11 intensive feedback loops involving capital-output ratio. Proportional and derivative control over this ratio by monopoly capital is taken into account. Pair of supercritical Andronov–Hopf bifurcations gives birth to two limit cycles. The second is a remote analogue for Kuznets cycle with the period of about 18 years; the first upholds the industrial cycle with period of about 7 years and declining net output in the outright crisis. Besides relative and absolute over-accumulation of capital, the specific positive and negative feedback loops containing capital-output ratio are required for crises in industrial cycles. Long-term enhancement of monopoly profit through lowering a targeted domestic capital accumulation rate and diminishing a targeted output-capital ratio is substantiated analytically and validated by computer simulations. The gained insights highlight caveats for hastily policy recommendations.

Covid-induced school closures in the United States and Germany: long-term distributional effects

Abstract Almost all countries worldwide closed schools at the outbreak of the Covid-19 crisis. I document that schooling time dropped on average by −55% in the United States and −45% in Germany from the onset of the crisis to the summer of 2021. In the United States, schools were closed longer in richer than in poorer areas, while in Germany the regional variation is much smaller. However, Germany exhibited substantial variation by grade level, with a strong U-shaped pattern that implies that children attending middle school faced the longest closures. A structural model of human capital accumulation predicts that the US school closures on average lead to a reduction of life-time earnings of –1.8% for the affected children. While the overall losses are likely somewhat smaller in Germany, the socio-economic gradient in the losses could be larger than in the United States, leading to increased inequality and decreased intergenerational mobility.

Referrals, intergenerational mobility and human capital accumulation

The aim of this paper is to investigate the interaction between two channels of intergenerational transmission of inequalities: parental income and networks. For this purpose, job referrals are introduced in an overlapping generations model of human capital accumulation with borrowing constraints. Although the exploitation of workers' networks through referrals can decrease the costs borne by firms and workers in the matching process, they also widen the opportunity gap between workers having parents with different educational levels. It is shown that when market inequalities are high, segregation effects may overcome the gains provided in the labour market by referrals. Even though referrals are exploited only in the educated segment of the labour market, the reduction of frictional costs may coexist with an overall negative effect on human capital accumulation.

Cultural capital and constrained agency in debt-migration for construction work in India

ABSTRACT Debt-migration is endemic in construction work in India, where exploitative social relations are an integral part of businesses’ capital accumulation model that can entrap migrants in forced labour and perpetual indebtedness. Drawing on concepts of cultural capital, ‘constrained agency’, and qualitative interviews with migrants and their wives, this study examines the embodied and material practices that migrants in Telangana use to challenge power hierarchies and embark on different life trajectories. The paper draws out the gendered differences in cultural capital and agential strategies that migrants use to place themselves and their families on an upwardly mobile path. Although still in debt, many migrants had succeeded in buying land, investing in farming, marrying their daughters, releasing themselves from moneylenders, and educating their children privately. A few had transitioned to working and living more permanently in the city of Hyderabad. This research sheds new light on how constrained agency and the use of cultural capital intersects with gender, ethnicity, and caste. It also shows that while the situations of both those who continue to circulate and those who settle in the city remain precarious, small incremental changes can add up to a significant shift in social and economic circumstances.

CHILDREN’S LEARNING ENVIRONMENT AND GROWTH-PROMOTING INCOME REDISTRIBUTION

Bénabou [(2002) Econometrica 70, 481–517.] demonstrated how progressive redistribution mitigates unequal opportunity for education to promote growth. We ask how effective that policy is when it affects the average quality of education. So, we add a learning externality in his model of human capital accumulation. It captures how knowledge diffusion through global channels—such as a national educational curriculum—influences children’s learning outcomes and, hence, growth. Whether inequality is a curse or a blessing for economic growth depends on how efficiently an economy designs these channels and to what extent they influence children’s education. The greater this efficiency, the lower is the optimal progressiveness of income redistribution for maximizing the long-run output growth rate. Interestingly, if poorly designed global channels exert greater influence in education, the optimal progressivity may increase. Our quantitative analysis reveals new implications for redistributive policies, including a surprisingly low optimal progressivity (approximately 6–7%) for the calibrated US economy.

A statistical field approach to capital accumulation

This paper presents a model of capital accumulation for a large number of heterogeneous producer–consumer agents in an exchange space in which interactions depend on agents’ positions. Agents in the exchange space are subject to both attractive and repulsive forces: exchanges drive agents closer, but crowd out more distant agents. The formalism used in this paper was developed earlier by the authors and is based on statistical field theory. It allows the analytical treatment of economic models with an arbitrary number of agents, while preserving the system’s interactions and microeconomic features of the individual level. Our results show that the dynamics of capital accumulation and the agents’ positions in the exchange space are correlated. Interactions in the exchange space induce phases within the system that depend on the relative strength of the repulsive force. When the repulsive force is strong, the system is in a phase of regulated exchanges. An initial central position both favours and fastens capital accumulation in average, and high levels of initial capital drive agents towards the centre. Yet, this phase displays mild competition and a broad-based although slow improvement in exchange terms. In this phase, random shocks can redistribute capital and initiate a virtuous circle of capital accumulation. When the repulsive force is low, a phase of deregulated exchanges emerges, in which capital distribution is less homogeneous and competition among agents harshens. Increased mobility accelerates capital accumulation for high initial capital producers, whereas low initial capital producers are now evicted from the exchange space as their prices and revenues deteriorate. Thus, a threshold effect appears. Above a certain level of initial capital, agents benefit from and remain in a central position. Below this level, they remain at the periphery of the exchange space.

Chaos Prediction in Fractional Delayed Energy-Based Models of Capital Accumulation

This paper presents the nonlinear dynamic analysis of energy-based models arisen from the applied systems characterized by the energy transport in the presence of fractional order derivative and time delay. The studied model is the fractional version of Bianca-Ferrara-Dalgaard-Strulik (BFDS) model of economy which is viewed as a transport network for energy in which the law of motion of capital occurs. By considering the time delay as bifurcation parameter, a proof to investigate the existence of Hopf bifurcation and the phase lock solutions using the Poincare-Linstedt and the harmonic balance methods is given. At definite values of time delay, period-doubling bifurcations followed up by the consequences of chaotic states are detected. Simulation results assure that the BFDS model can generate new (hyper) chaotic attractors beyond half order derivatives through the effect of the time delay on that system. In accordance with the literatures related to the problem of chaos, the concluded results confirm the proposed theorem by El-Borhamy in which the time delay possesses the ability to change the dynamic state of nonlinear systems from regular to chaotic within the fractional order derivative domain.

Recursive median-voter equilibria in a public capital accumulation model

We study a dynamic public capital accumulation model with infinitely-lived agents who follow the standard discounted utility model in their roles as consumers and voters. Saving policies are determined sequentially, period-by-period, by majority voting. When there is discounting heterogeneity, but no heterogeneity in consumption smoothing, a unique and Pareto-efficient recursive median-voter equilibrium exists. Although equilibrium need not always exist when agents are heterogeneous in both dimensions, we show its existence and Pareto-efficiency when agents' preferences are in the CES family.