Human Capital: Advances In Theory And Evidence

This page intentionally left blank Human Capital At a time when governments and policy-makers put so much emphasis on ‘the knowledge economy’ and the economic value of education, human capital theory has never been more important. However, research in this area is often very technical and therefore not easily accessible to those who wish to use it as a guide to policy formation. This book provides an interface between such research and its potential applications in government, education and business. Reporting on a major research initiative, new findings are presented in a non-technical way on three major themes: measuring the benefits from human capital, applications of the human capital model, and policy interventions. Aimed at academic researchers and professionals concerned with the problems and techniques of human capital theory, it will also be useful for graduate courses on the economics of education as a complement to standard textbooks. JOOP HARTOG is Professor of Economics at the University of Amsterdam. H E N R I E¨ T T E M A A S S E N V A N D E N B R I N K University of Amsterdam. is Professor of Economics at the Human Capital Advances in Theory and Evidence edited by JOOP HARTOG AND H E N R I E¨ T T E M A A S S E N V A N D E N B R I N K CAMBRIDGE UNIVERSITY PRESS Cambridge, New York, Melbourne, Madrid, Cape Town, Singapore, São Paulo Cambridge University Press The Edinburgh Building, Cambridge CB2 8RU, UK Published in the United States of America by Cambridge University Press, New York www.cambridge.org Information on this title: www.cambridge.org/9780521873161 © Cambridge University Press 2007 This publication is in copyright. Subject to statutory exception and to the provision of relevant collective licensing agreements, no reproduction of any part may take place without the written permission of Cambridge University Press. First published in print format 2007 eBook (EBL) ISBN-13 978-0-511-28911-8 ISBN-10 0-511-28911-1 eBook (EBL) ISBN-13 ISBN-10 hardback 978-0-521-87316-1 hardback 0-521-87316-9 Cambridge University Press has no responsibility for the persistence or accuracy of urls for external or third-party internet websites referred to in this publication, and does not guarantee that any content on such websites is, or will remain, accurate or appropriate. Contents List of figures List of tables Notes on contributors Prologue Joop Hartog and Henrie¨tte Maassen van den Brink page vii viii ix 1 Part I Measuring the benefits from human capital 1 2 3 4 5 6 What should you know about the private returns to education? Joop Hartog and Hessel Oosterbeek The social returns to education Mikael Lindahl and Erik Canton 21 Returns to training Edwin Leuven 38 Human capital and entrepreneurs Justin van der Sluis and C. Mirjam van