A Hierarchy of Human Capital and Economic Growth

This paper focuses on the relationship between economic growth and the hierarchical structure of human capital of different levels of abstraction. The model is the usual endogenous growth model with the inclusion of Beckmann's "span of control" technology. Major findings are: (1) the optimal structure of human capital is pyramidal. and (2) when there exist externalities of technology from the most developed foreign countries to the catching-up. the catching-up country shows more rapid economic growth and relatively more investment on the lower level human capital than on the higher. The comparison between the U.S.A. and Japanese or Korean data provides the empirical support for these implications.