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Empirical studies show extraordinarily high rates of return to investments in human and environmental public goods. This chapter demonstrates empirically, however, that the majority of governments in developing countries fail to invest sufficiently in public goods such as research and development, human capital, and the management of the environment. Such underinvestment causes a major distortion that partially explains the triple curse of slow growth, large social inequities and poverty, and environmental destruction that has typified most developing countries over recent decades. The chapter examines the contribution of IMF and World Bank supported structural adjustment, such as fiscal deficit reduction, privatization of state enterprises, and trade liberalization, in the light of the above framework. Rather than analyzing how each of the reforms may affect the environment, the chapter focuses on whether structural adjustment is likely to correct the under investment in human capital and environmental capital discussed above, and whether there are specific policies within structural adjustment that are likely to particularly affect such under investment.

This chapter analyzes Mincer's contribution to income distribution research, namely the way he placed human capital at the center of that research. It commences with a brief analysis of the debates that marked the development of research in personal income distribution during the first half of the 20th century. Mincer's thesis of 1957 is analyzed by showing how his work incorporated a broader debate about the purposes and uses of research in personal income. The chapter proceeds by covering Mincer's subsequent work on human capital and lifetime income and wage patterns, which reached a high point with his 1974 book Schooling, Experience, and Earnings and the formulation of the human capital earnings function, which would become a centerpiece of modern labor research. The chapter also shows the way Mincer's research has significantly influenced the economic analysis of income distribution.

This chapter examines the economic reforms for capital formation and economic transformation, as well as the estimation of aggregate investment in Korea under Japanese rule between 1905 and 1945. The reform measures examined are those that removed economic and political obstacles, and those that established a new infrastructure to accommodate the workings of a government-controlled but market-oriented economy aimed at promoting capital formation and economic development. The estimation of investment considered not only the aggregate sum, but also the different nationalities (namely, Japanese, foreigners, and Koreans). The chapter also evaluates the impact of foreign investment, especially that of the Japanese, on Korean investment in terms of catalytic, linkage, oppression effects, as well as the benefits derived from external economies. Investment in human capital is assessed in terms of the overall expansion of the school system, student enrollments, and educational opportunities for Japanese and Koreans. The analysis includes private education, particularly that of the Christian missionaries, which played an important role in educating future Korean leaders.

This chapter broadens current agency approaches by exploring the possible consequences of optimizing CG structures with ‘multiple principals’ and multiple governance and organizational mechanisms. It uses an analytical framework and an empirical study conducted in Italy, which gathers empirically the actual preferences of two samples, representative of the providers of financial and human capital, over varying policies on a variety of governance and organizational mechanisms (e.g., low to high pay for performance; low to high teamwork; low to high managerial representation in boards etc.). Preferences are cluster-analyzed and compared with actually implemented policies. Results indicate that actors' preferences converge more than conventionally expected, while they differ sharply from actually implemented policies, thereby indicating opportunities for the Pareto-improvement of CG structures.

Although Jacob Mincer is well known for his work on income distribution and the labor supply phenomena, he also explored other important topics in labor research. This chapter explores his efforts to understand better the dynamic nature of the labor market, especially with regard to workers' mobility and unemployment. The chapter also analyzes Mincer's work on the impact of some labor market regulations and on the employment effects of economic growth. The analysis of that part of his research provides a better understanding of the main characteristics of Mincer's work and helps to grasp fully his influence on contemporary labor research. It also reveals that underlying and unifying his research was a persistent aim at exploring the explanatory power of human capital analysis and its implications for the dynamics of the labor market.

This chapter appraises the role played by Jacob Mincer in labor economics during his long and prolific career. Mincer is certainly a good example of the capacity that many academics have to attract the attention of those around them and to interest them in pursuing similar lines of research. His ability to lure students and colleagues to human capital research was extremely relevant for the development of the human capital research program, especially in the early crucial years. Moreover, his persistent and methodic interest in the analysis of the implications of human capital for labor market analysis had a lasting influence on several generations of labor economists, and contributed to the strengthening of the position human capital came to occupy in labor economics during the last forty years. This chapter analyzes the impact Mincer had through his publications, as a teacher, and especially as a mentor of several emerging leading labor economists. The impact this relationship with his students had on the development of the human capital research agenda is explored.

Research on the determinants of executive compensation has a very long tradition in a variety of academic fields. This chapter focuses on the key ideas that emerge from a review of this work, especially in the management literature. Executive pay is generally determined by economic factors, social factors, and political factors, each of which is examined in this chapter. Economic factors include size, performance, human capital, risk, and marginal product. Managerial discretion, discussed in Chapter 2, also plays a big role. Social factors tend to fall into three categories—institutional pressures, social comparison processes, and social capital—each of which suggests alternative predictors of executive compensation. Finally, political factors are very much about power. The chapter concludes with a short section on the compensation of general managers at a business-unit level.

Family economics, which looks at the production and consumption in a household, can be applied to religion. The household is typically husband and wife, parents and children, operates under constraints of time and money, seeking both economic goals (income) and non-economic goals, such as leisure. Religion falls under the non-economic goals of a household. But all activity in a household can have future consequences, which economics explains with the concept of “human capital.” Education is the typical example. It is an accumulation of skill, habit, and knowledge (capital) that enriches life and promise higher income. The capital approach can be applied to religion by analyzing the household accumulation of religious habit, knowledge, and association. Human “religious capital” predicts religious affiliations, tastes, conversions, “switching,” and marriages. It also throws light on life-cycle patterns of how individuals and families invest time and money in religious beliefs and behaviors.

Despite fruitful collaborations and developments, human capital analysis was increasingly challenged. The criticisms became more noticeable in the mid-1970s when the private returns to education started falling rapidly. It was argued that because earlier estimates of returns to education had been based on cross-sectional data, they had overestimated the returns to education, and with the progressive expansion of educated labor the returns would diminish steadily. The effect of the arrival of the college-educated, post-World War II baby boomers on the labor market seemed to fulfill this prophecy. The contribution of human capital in understanding inequality and labor market outcomes came under severe scrutiny from the early 1970s onwards. This chapter examines the major criticisms of the human capital approach to the labor market and the way human capital dealt with these will be scrutinized. Moreover, it assesses Mincer's contribution to these debates and to what extent his research endured through those controversies.

This chapter examines social interactions in human capital spillovers by focusing on spatial patterns in productivity, wages, and incomes, with particular emphasis on whether spatial concentration causes higher productivity. It begins with a discussion of aggregative spatial measures, such as economic activity at the level of states, regions, and counties in comparison with the smaller scale of cities and their neighborhoods. It then considers the interdependence between spatial interactions and spatial economic activity, the implications of spatial equilibrium for the urban wage premium, and human capital spillovers in microneighborhoods and in synthetic neighborhoods. It also shows how differences in patterns of productivity across locations and at different scales of spatial aggregation may be rationalized in terms of simple models of social interactions.

This chapter describes how hunger is addressed by the Bank nutrition team. It examines the interlacing of economic ideology and politics in World Bank nutrition policy through focusing on the periods 1971-1980, 1980-1993, and 1993-2006. It concludes that undernutrition is constructed as a matter of choice for households.

This chapter starts by making a brief portrait of labor economics in the decades preceding Mincer's work. When Jacob Mincer started his academic career, labor economics was finishing a long process of change that marked the postwar years. This transformation, crucial for understanding the emergence of human capital theory, was generally characterized by the increasing pervasiveness of neoclassical economic theory in a field traditionally more attached to an empirical and institutionalist research agenda. Under the stimulus of some prominent labor researchers, Mincer became increasingly interested in labor issues, namely in labor supply behavior. This chapter analyzes some of his major pieces of research around the theme of labor supply and lifetime labor income, and the way these differed from previous labor research. This work is also presented in a way that shows the close links between Mincer's research on human capital and the long-term behavior of labor supply.

This final chapter sums up the analysis of Jacob Mincer's prolific and interesting career. It also highlights the hallmarks of Mincer's approach to economic analysis. It points out his major contributions to economic analysis and suggests the topics and features by which his work will continue to influence future generations of (labor) economists.

This book examines the role of labour standards in sustainable development and this chapter addresses this issue at a fairly abstract level. It argues that if we could have clear thinking about labour standards and clear thinking about sustainable development, then we would say that there is an intimate connection and profound overlap between labour standards and development. This is because, first, there is an intimate and profound connection between human freedom on the one hand, and human capital on the other. Second, development is the process of the removal of obstacles to real human freedom conceived of as the real capacity to lead lives which we have reason to value. Third, labour law is that part of our law which structures and mobilises the deployment of human capital, that is, which structures and mobilises the ‘exploitation’ (in the best sense of the word) of human capital, which is at the core of human freedom. Thus, if development is about human freedom and labour law is about human capital, then labour law is a key to development.

The idea that education can provide benefits, even economic ones, is certainly an old one. At least by the late 18th century, some people started thinking about skilled individuals as a kind of expensive instrument and machine, a kind of capital whose long-term benefit would compensate the efforts and expenditures of years of early personal and intellectual development. These metaphors about the economic potential of education and training coalesced in the late 1950s becoming one of the most popular research programs of contemporary economics. It is nevertheless rather peculiar that it took so much time for economists to pick-up on those metaphors and turn them into a fully-fledged theoretical framework. Likewise, it is quite interesting to investigate the way prior resistances or lack of attention gave way to subsequent popularity within the discipline. This chapter analyzes the early lack of attention and the increasing attention in the postwar period to the economic value of education.

This chapter summarizes what is common and what is not in the experiences of the individual countries studied. It develops an interpretive framework for understanding the growth of the software industry in these countries, and attempts to distill the lessons that others can learn. What stands out in this story is the role of human capital and human capital flows, and the role of those flows in opening these countries to the outside world. The least appreciated aspect of the growth of the software in the 3Is has been the role of entrepreneurship and the development of firm level capabilities.

This chapter examines the relationship between human capital and productivity among three industrialized economies: Britain, Germany, and the United States. It first presents sectoral estimates of comparative labour productivity from 1870 to 1990. It then examines the process by which Britain was overtaken at the beginning of the twentieth century by the upstart economies of the United States and Germany.

This chapter takes a look at the causes and return of social capital for 126 personnel managers in the export processing zones (EPZs) and one science park (SP) in Taiwan. It uses the data gathered from position-generated networks and participation in voluntary associations. This chapter is able to identify some new issues relating to social capital, such as the lack of connections between human capital and the extensity of accessed positions in the field of personnel managers.

Argues that during the early modern period in Europe living standards gradually rose not only because probate inventories reveal that people were acquiring more and better quality durable goods. They were also increasingly allocating resources to the acquisition of the skills of literacy. Partly, this human capital served to enhance their productivity and earning ability, but it also served for pleasure, edification and gaining status and to this extent it should be considered as a consumer durable too. A quantitative exercise tries to show that if this is factored into the more traditional ‘material consumption’ approach, it can lead to a significant reconsideration of the standard of living debate, in particular, as regards the eighteenth century.

This chapter extends the Allais–Samuelson Overlapping Generations models presented in chapters 1 and 2 to study interactions between infrastructure and human capital with R&D activities and growth. It begins by providing some background evidence on these interactions. The model is then presented and solved, and the impact of public policy, including potential trade-offs associated with the provision of infrastructure and other services by the government, is discussed. Again, this is a critical issue; if governments have access to limited resources to cover their expenditure, different types of government interventions may entail (temporary or permanent) trade-offs at the macroeconomic level—even though at the microeconomic or sectoral level these interventions are largely complementary. In addition, different types of government intervention may generate spillover effects on other sectors, which may have an indirect impact on innovation capacity.