Human capital stocks and the development of Italian regions. A panel approach

TitleHuman capital stocks and the development of Italian regions. A panel approach
Publication TypeWorking Paper
Year of Publication1998
AuthorsA. Di Liberto, J. Symons
Number1998_04
Abstract

Given recent emphasis on externality to education, macroeconomic studies have a role to play in the analysis of return to schooling. In this paper we study the connection between growth and human capital for the Italian regions in a convergence regression framework. We confirm the usual result on Italian regional convergence that this process began to diminish or fail after about 1975. We include a measure of human capital in the convergence regression as a stock rather than a flows. We find this variable is significant if and only if we control for the size of the public sector. The public sector is itself strongly negative. Decomposing the human capital measure into its constituents, we find that average years of primary and secondary education act positively on growth, but that tertiary education acts negatively. When we estimate the convergence regression for the South and the North-Centre separately, we find no break in the pattern of convergence around 1975. Thus both areas seem to be converging according to a similar process, albeit to different levels of GDP per capita. The role of the human capital is strikingly similar in the two clubs. Finally, we find educating women leads to faster growth.

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