Institutional Affiliation: Erasmus University Rotterdam
|Policies to Create and Destroy Human Capital in Europe|
with : w15742
Trends in skill bias and greater turbulence in modern labor markets put wages and employment prospects of unskilled workers under pressure. Weak incentives to utilize and maintain skills over the life-cycle become manifest with the ageing of the population. Policies to promote human capital formation reduce welfare state dependency among the unskilled and offset inefficiencies in human capital formation. Skill formation features strong dynamic complementarities over the life-cycle. Investments in the human capital of children have higher returns than investments in the human capital of older workers. There is no trade-off between equity and efficiency at early ages of human development but there is a substantial trade-off at later ages. Later remediation of skill deficits acquired in early...
Published: Heckman, James J., and Bas Jacobs (2011), "Policies to Create and Destroy Human Capital in Europe", in: Edmund Phelps and Hans-Werner Sinn (eds) (2011), Perspectives on the Performance on the Continent's Economies, Cambridge-MA: MIT-Press, 253-323.