Human Capital and Economic Growth in India, Indonesia, and Japan: A quantitative analysis, 1890-2000

Bas van Leeuwen

Abstract of thesis

The analysis of endogenous economic growth may be subdivided into two broad streams of theories. The main difference between these two groups rests on whether a country is at the technological frontier. In less developed countries (which are further from the technological frontier) technologies can be adopted from abroad (Lucasian growth). Hence, their human capital is used entirely to apply these technologies in the productive process. As a country develops further (approaches the technological frontier), it becomes increasingly difficult to adopt technologies from abroad and, therefore, more and more of its own human capital must be used to create new technologies (Romerian growth: R&D). The remaining human capital is used to apply these new technologies in the productive process.
From this perspective it is not surprising that Japan moved from Lucasian to Romerian growth in the mid-twentieth century. In the first half of the century, Japan witnessed a strong growth of human capital. This led to a strong growth of the industrial sector and an increase in technological development which attributed to the switch to Romerian growth in the second half of the century. India and Indonesia, however, remained dominated by Lucasian growth. Not only was their per capita stock of human capital much lower than in Japan, but it was also less efficient. In addition, these countries were disadvantaged by their late economic development. It was no longer enough to employ enough secondary trained persons to generate technological development. Technological development started to take place at the level of higher education, a level where these countries had a relative disadvantage compared to more developed countries.

Thesis

• Title
• Table of contents
• List of figures
• List of tables
• Preface and acknowledgements
• Chapter 1: Problems in analyzing economic development
• Chapter 2: Literature on the relation between human capital and economic growth: definitions and problems
• Chapter 3: Basic data and measurement issues: standard proxy estimates of human capital
• Chapter 4: Converging patterns? Educational policies and development in an educational age
• Chapter 5: New estimates of the formation and stock of human capital
• Chapter 6: Is Lucas right? On the role of human capital in growth theory
• Chapter 7: The contribution of human capital to growth: some estimates
• Chapter 8: A historical interpretation of the new growth theories: an overview
• Appendices
• References
• Summary
• Complete thesis (2,135 Kb)

Data available in thesis

(for a description and sources see appendices)

• Appendix A.1: Craftsmen and labourers' wages and price indices in Japan in current yen, 1870-2000
  Excel 1997-2003 spreadsheet, 26 Kb
• Appendix A.1: Craftsmen and labourers' wages and price indices in India in current rupees, 1870-2000
  Excel 1997-2003 spreadsheet, 26 Kb
• Appendix A.1: Craftsmen and labourers' wages and price indices in Indonesia in current rupiah, 1870-2000
  Excel 1997-2003 spreadsheet, 26 Kb
• Appendix A.2: GDP in India, Indonesia, and Japan, 1890-2000 (constant 1990 International USD)
  Excel 1997-2003 spreadsheet, 33 Kb
• Appendix A.2: Gross Fixed Non-Residential Physical Capital Stock in India, Indonesia, and Japan, 1890-2000 (constant 1990 International USD, with the Indonesian data also in current rupiah)
  Excel 1997-2003 spreadsheet, 36 Kb
• Appendix A.2: Population in India, Indonesia, and Japan, 1890-2000
  Excel 1997-2003 spreadsheet, 33 Kb
• Appendix A.2: Persons employed in India, Indonesia, and Japan, 1890-2000
  Excel 1997-2003 spreadsheet, 33 Kb
• Appendix A.4: Indonesian GDP according to the expenditure approach and its subdivision (billion current rupiah), 1890-2002
  Excel 1997-2003 spreadsheet, 40 Kb
• Appendix A.5: Gross Enrolment Ratio per Ethnicity and level of education in Indonesia, 1890-1940
  Excel 1997-2003 spreadsheet, 23 Kb
• Appendix A.6: Enrolments per level of education and sex in Indonesia, 1880-2000
  Excel 1997-2003 spreadsheet, 30 Kb
• Appendix A.6: Enrolments per level of education and sex in India, 1880-2000
  Excel 1997-2003 spreadsheet, 35 Kb
• Appendix A.6: Enrolments per level of education and sex in Japan, 1880-2000
  Excel 1997-2003 spreadsheet, 33 Kb
• Appendix A.6: Gross enrolment ratio per level of education in India, Indonesia, and Japan, 1880-2000
  Excel 1997-2003 spreadsheet, 31 Kb
• Appendix A.7: Educational attainment by level of education in Indonesia, 1893-2000
  Excel 1997-2003 spreadsheet, 26 Kb
• Appendix A.7: Educational attainment by level of education in India, 1890-2000
  Excel 1997-2003 spreadsheet, 26 Kb
• Appendix A.7: Educational attainment by level of education in Japan, 1890-2000
  Excel 1997-2003 spreadsheet, 26 Kb
• Appendix A.7: Average years of education in the population aged 15 and over in India, Indonesia, and Japan, 1890-2000
  Excel 1997-2003 spreadsheet, 27 Kb
• Appendix A.8: Public and private expenditure on education in Japan (current Yen), 1886-2000
  Excel 1997-2003 spreadsheet, 39 Kb
• Appendix A.8: Public and private expenditure on education in Indonesia (current Rupiah), 1880-2000
  Excel 1997-2003 spreadsheet, 37 Kb
• Appendix A.8: Public and private expenditure on education in India (current Rupee), 1880-2000
  Excel 1997-2003 spreadsheet, 33 Kb
• Appendix A.9: Investment in human capital in Japan 1895-2002 in billion 1990 International USD
  Excel 1997-2003 spreadsheet, 31 Kb
• Appendix A.10: Investment in human capital in Indonesia 1890-2002 in billion 1990 International USD
  Excel 1997-2003 spreadsheet, 33 Kb
• Appendix A.11: Investment in human capital in India 1890-2000 in billion 1990 International USD
  Excel 1997-2003 spreadsheet, 31 Kb
• Appendix A.12: Stock of Human Capital in India, Indonesia, and Japan, 1890-2002 in billion 1990 International USD
  Excel 1997-2003 spreadsheet, 28 Kb
• Appendix A.13: Indonesian GDP and its components (expenditure approach) corrected for human capital (billion current rupiah), 1890-2000
  Excel 1997-2003 spreadsheet, 43 Kb
• Appendix A.13: GDP corrected for Gross Human Capital Formation in Japan, India, and Indonesia 1890-2000 (million 1990 International USD)
  Excel 1997-2003 spreadsheet, 25 Kb

Additional data, not available in thesis

Craftsmen and labourers' wages and price indices in India in constant 1913 Rupee, 1800-2000
- About this datafile
- Excel 1997-2003 spreadsheet, 37 Kb

Working papers based on thesis

• Péter Földvári and Bas van Leeuwen, 'An Estimation of the Human Capital Stock in Eastern and Central Europe', Eastern European Economics, Vol. 43 (6) 2006, 53-65.
• Péter Földvári and Bas van Leeuwen, 'An Alternative Interpretation of "average years of education" in growth regressions,' Applied Economics Letters, (2007, forthcoming).
• Bas van Leeuwen and Péter Földvári, 'Human Capital and Economic Growth in Asia 1890-2000: a time-series analysis,' 2007.
• Bas van Leeuwen and Péter Földvári, 'How much human capital does Eastern Europe have? Measurement methods and results', version 1, 20 august 2007 (pdf, 27 pp, 297Kb).

See also

Human Capital Hub of the CLIO-INFRA initiative