Hostname: page-component-6d856f89d9-72csx Total loading time: 0 Render date: 2024-07-16T07:29:01.779Z Has data issue: false hasContentIssue false
  • English
  • Français

CHILDREN’S HEALTH, HUMAN CAPITAL ACCUMULATION, AND R&D-BASED ECONOMIC GROWTH

Published online by Cambridge University Press:  28 May 2019

Annarita Baldanzi ,
Alberto Bucci  and
Klaus Prettner
Annarita Baldanzi
Affiliation:
University of Milan and University of Pavia
Alberto Bucci
Affiliation:
University of Milan RCEA (Rimini Center for Economic Analysis) CEIS (University of Rome-‘Tor Vergata’)
Klaus Prettner*
Affiliation:
University of Hohenheim
*
Address correspondence to: Klaus Prettner, Institute of Economics, University of Hohenheim, Schloss, Osthof-West, 70593 Stuttgart, Germany. e-mail: [email protected]. Phone: +49 711 459 23453
Get access Rights & Permissions [Opens in a new window]

Abstract

We analyze the effects of children’s health on human capital accumulation and on long-run economic growth. For this purpose, we design an R&D-based growth model in which the stock of human capital of the next generation is determined by parental education and health investments. We show that (i) there is a complementarity between education and health: if parents want to have better educated children, they also raise health investments and vice versa; (ii) parental health investments exert an unambiguously positive effect on long-run economic growth, (iii) faster population growth reduces long-run economic growth. These results are consistent with the empirical evidence for modern economies in the twentieth century.

Keywords

Children’s HealthEducationFertilityLong-run Economic Development
Type
Articles
Information
Macroeconomic Dynamics , Volume 25 , Issue 3 , April 2021 , pp. 651 - 668
Copyright
© Cambridge University Press 2019

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

Footnotes

We would like to thank the editor of the special issue Luca Gori, two anonymous referees, Fabio Mariani, and Paul Tscheuschner for valuable comments and suggestions. Klaus Prettner gratefully acknowledges the funding provided by the Faculty of Economics and Social Sciences at the University of Hohenheim within its research focus “Inequality and Economic Policy Analysis” (INEPA). This research did not receive any other grant from funding agencies in the public, commercial, or not-for-profit sectors.

References

REFERENCES

Acemoglu, D. and Johnson, S. (2007) Disease and development: The effect of life expectancy on economic growth. Journal of Political Economy 115(6), 925–985.CrossRefGoogle Scholar
Aghion, P. and Howitt, P. (1992) A model of growth through creative destruction. Econometrica 60(2), 323–351.CrossRefGoogle Scholar
Aghion, P., Howitt, P., and Murtin, F. (2011) The relationship between health and growth: When Lucas meets Nelson-Phelps. Review of Economics and Institutions 2(1), 1–24.Google Scholar
Ahituv, A. (2001) Be fruitful or multiply: On the interplay between fertility and economic development. Journal of Population Economics 14, 51–71.CrossRefGoogle Scholar
Andreoni, J. (1989) Giving with impure altruism: Applications to charity and Ricardian equivalence. Journal of Political Economy 97, 1447–1458.CrossRefGoogle Scholar
Bar, M. and Leukhina, O. (2010) The role of mortality in the transmission of knowledge. Journal of Economic Growth 15(4), 291–321.CrossRefGoogle Scholar
Becker, G. S. (2007) Health as human capital: Synthesis and extensions. Oxford Economic Papers 59(3), 379–410.CrossRefGoogle Scholar
Becker, G. S. and Lewis, H. G. (1973) On the interaction between the quantity and quality of children. Journal of Political Economy 81, 279–288.CrossRefGoogle Scholar
Behrman, J. R. (2009) Early life nutrition and subsequent education, health, wage, and intergenerational effects. Health and Growth 6, 167–183.Google Scholar
Behrman, J. R. and Rosenzweig, M. R. (2004) Returns to birthweight. Review of Economics and statistics 86(2), 586–601.CrossRefGoogle Scholar
Ben-Porath, Y. (1967) The production of human capital and the life cycle of earnings. Journal of Political Economy 75(4), 352–365.CrossRefGoogle Scholar
Berk, J. and Weil, D. N. (2015) Old teachers, old ideas, and the effect of population aging on economic growth. Research in Economics 69(4), 661–670.CrossRefGoogle Scholar
Bhattacharya, J. and Qiao, X. (2007) Public and private expenditures on health in a growth model. Journal of Economic Dynamics and Control 31(8), 2519–2535.CrossRefGoogle Scholar
Blackburn, K. and Cipriani, G. P. (2002) A model of longevity, fertility and growth. Journal of Economic Dynamics and Control 26(2), 187–204.CrossRefGoogle Scholar
Bloom, D. E., Cafiero-Fonseca, E. T., McGovern, M. E., Prettner, K., Stanciole, A., Weiss, J., Bakkila, S., and Rosenberg, L. (2014) The macroeconomic impact of non-communicable diseases in China and India: Estimates, projections, and comparisons. The Journal of the Economics of Ageing 4, 100–111.CrossRefGoogle Scholar
Bloom, D. E. and Canning, D. (2000) The health and wealth of nations. Science 287(5456), 1207–1209.CrossRefGoogle ScholarPubMed
Bloom, D. E., Kuhn, M., and Prettner, K. (2015) The Contribution of Female Health to Economic Development. NBER Working Paper: No. 21411.CrossRefGoogle Scholar
Boucekkine, R., de la Croix, D., and Licandro, O. (2003) Early mortality declines at the dawn of modern growth. The Scandinavian Journal of Economics 105(3), 401–418.CrossRefGoogle Scholar
Boucekkine, R., de la Croix, D., and Licandro, O. (2002) Vintage human capital, demographic trends, and endogenous growth. Journal of Economic Theory 104(2), 340–375.CrossRefGoogle Scholar
Brander, J. A. and Dowrick, S. (1994) The role of fertility and population in economic growth. Journal of Population Economics 7(1), 1–25.CrossRefGoogle ScholarPubMed
Bucci, A. (2008) Population growth in a model of economic growth with human capital accumulation and horizontal R&D. Journal of Macroeconomics 30(3), 1124–1147.CrossRefGoogle Scholar
Bucci, A. (2013) Returns to specialization, competition, population, and growth. Journal of Economic Dynamics and Control 37, 2023–2040.CrossRefGoogle Scholar
Case, A., Fertig, A., and Paxson, C. (2005) The lasting impact of childhood health and circumstance. Journal of Health Economics 24(2), 365–389.CrossRefGoogle ScholarPubMed
Castelló-Climent, A. and Doménech, R. (2008) Human capital inequality, life expectancy and economic growth. The Economic Journal 118(528), 653–677.CrossRefGoogle Scholar
Cervellati, M. and Sunde, U. (2005) Human capital formation, life expectancy, and the process of development. American Economic Review 95(5), 1653–1672.CrossRefGoogle ScholarPubMed
Cervellati, M. and Sunde, U. (2011) Life expectancy and economic growth: The role of the demographic transition. Journal of Economic Growth 16, 99–133.CrossRefGoogle Scholar
Cervellati, M. and Sunde, U. (2013) Life expectancy, schooling, and lifetime labor supply: Theory and evidence revisited. Econometrica 81(5), 2055–2086.Google Scholar
Chakraborty, S. (2004) Endogenous lifetime and economic growth. Journal of Economic Theory 116(1), 119–137.CrossRefGoogle Scholar
Chakraborty, S., Papageorgiou, C., and Sebastián, F. P. (2016) Health cycles and health transitions. Macroeconomic Dynamics 20 (1), 189–213 CrossRefGoogle Scholar
Currie, J. (2009) Healthy, wealthy, and wise: Socioeconomic status, poor health in childhood, and human capital development. Journal of Economic Literature 47(1), 87–122.CrossRefGoogle Scholar
de la Croix, D. and Licandro, O. (1999) Life expectancy and endogenous growth. Economics Letters 65(2), 255–263.CrossRefGoogle Scholar
de la Croix, D. and Licandro, O. (2013) The child is father of the man: Implications for the demographic transition. The Economic Journal 123(567), 236–261.CrossRefGoogle Scholar
Dixit, A. K. and Stiglitz, J. E. (1977) Monopolistic competition and optimum product diversity. American Economic Review 67(3), 297–308.Google Scholar
Fanti, L. and Gori, L. (2014a) Endogenous fertility, endogenous lifetime and economic growth: The role of child policies. Journal of Population Economics 27(2), 529–564.CrossRefGoogle Scholar
Fanti, L. and Gori, L. (2014b) An OLG model of growth with longevity: When grandparents take care of grandchildren. Portuguese Economic Journal 13(1), 39–51.CrossRefGoogle Scholar
Funke, M. and Strulik, H. (2000) On endogenous growth with physical capital, human capital and product variety. European Economic Review 44, 491–515.CrossRefGoogle Scholar
Galor, O. (2011) Unified Growth Theory. Princeton, NJ, USA: Princeton University Press.Google Scholar
Galor, O. and Weil, D. (2000) Population, technology, and growth: From Malthusian Stagnation to the demographic transition and beyond. The American Economic Review 90(4), 806–828.CrossRefGoogle Scholar
Gehringer, A. and Prettner, K. (2017) Longevity and technological change. Macroeconomic Dynamics (forthcoming) DOI: https://doi.org/10.1017/S1365100517000293 Google Scholar
Grossman, G. M. and Helpman, E. (1991) Quality ladders in the theory of economic growth. Review of Economic Studies 58(1), 43–61.CrossRefGoogle Scholar
Grossmann, V. (2007) How to promote R&D-based growth? Public education expenditure on scientists and engineers versus R&D subsidies. Journal of Macroeconomics 29(4), 891–911.CrossRefGoogle Scholar
Hashimoto, K.-i. and Tabata, K. (2005) Health infrastructure, demographic transition and growth. Review of Development Economics 9(4), 549–562.CrossRefGoogle Scholar
Herzer, D., Strulik, H., and Vollmer, S. (2012) The long-run determinants of fertility: One century of demographic change 1900–1999. Journal of Economic Growth 17(4), 357–385.CrossRefGoogle Scholar
Jones, C. I. (1995) R&D-based models of economic growth. Journal of Political Economy 103(4), 759–783.CrossRefGoogle Scholar
Jones, C. I. and Williams, J. C. (2000) Too much of a good thing? The economics of investment in R&D. Journal of Economic Growth 5(1), 65–85.CrossRefGoogle Scholar
Kalemli-Ozcan, S., Ryder, H. E., and Weil, D. N. (2000) Mortality decline, human capital investment, and economic growth. Journal of Development Economics 62(1), 1–23.CrossRefGoogle Scholar
Kuhn, M. and Prettner, K. (2016) Growth and welfare effects of health care in knowledge-based economies. Journal of Health Economics 46, 100–119.CrossRefGoogle ScholarPubMed
Lagerlöf, N.-P. (2003) From Malthus to modern growth: Can epidemics explain the three regimes? International Economic Review 44(2), 755–777.CrossRefGoogle Scholar
Lorentzen, P., McMillan, J., and Wacziarg, R. (2008) Death and development. Journal of Economic Growth 13, 81–124.CrossRefGoogle Scholar
Madsen, J.B. (2016) Health, human capital formation and knowledge production: Two centuries of international evidence. Macroeconomic Dynamics 20(4), 909–953 CrossRefGoogle Scholar
Peretto, P. F. (1998) Technological change and population growth. Journal of Economic Growth 3(4), Review 3(3), 207–213.Google Scholar
Preston, S. H. (1975) The changing relation between mortality and level of economic development. Population Studies 29(2), 231–248.CrossRefGoogle ScholarPubMed
Prettner, K. (2014) The non-monotonous impact of population growth on economic prosperity. Economics Letters 124, 93–95.CrossRefGoogle Scholar
Prettner, K., Bloom, D. E., and Strulik, H. (2013) Declining fertility and economic well-being: Do education and health ride to the rescue? Labour Economics 22, 70–79.CrossRefGoogle ScholarPubMed
Prettner, K. and Strulik, H. (2016) Technology, trade, and growth: The role of education Macroeconomic Dynamics 20, 1381–1394.CrossRefGoogle Scholar
Romer, P. (1990) Endogenous technological change. Journal of Political Economy 98(5), 71–102.CrossRefGoogle Scholar
Schultz, T. W. (1961) Investment in human capital. The American Economic Review 51(1), 1–17.Google Scholar
Segerström, P. S. (1998) Endogenous growth without scale effects. American Economic Review 88(5), 1290–1310.Google Scholar
Solow, R. M. (1956) A contribution to the theory of economic growth. The Quarterly Journal of Economics 70(1), 65–94.CrossRefGoogle Scholar
Strulik, H. (2005) The role of human capital and population growth in R&D-based models of economic growth. Review of International Economics 13(1), 129–145.CrossRefGoogle Scholar
Strulik, H., Prettner, K., and Prskawetz, A. (2013) The past and future of knowledge-based growth. Journal of Economic Growth 18(4), 411–437.CrossRefGoogle Scholar
The United States Patent and Trademark Office (2016) Url: http://www.uspto.gov [accessed on 11/06/2012].Google Scholar
World Bank (2016) World Development Indicators & Global Development Finance Database. Available at: http://databank.worldbank.org/data/reports.aspx?source=world-development-indicators#.Google Scholar