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Innovation, Technology Diffusion and Poverty Traps: The Role of Valuable Skills

Messinis, George and Ahmed, Abdullahi D (2010) Innovation, Technology Diffusion and Poverty Traps: The Role of Valuable Skills. Working Paper. Victoria University, Melbourne, Australia.

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Abstract

This paper develops a new index of human capital that measures cognitive skills employed by the adult population in seventy nations during 1970-2003. The index is compared to existing measures of human capital in the Benhabib and Spiegel (2005) model. Analysis goes beyond the Cobb-Douglas production function. The evidence shows that (i) the new index best explains trends in technology growth; (ii) the skillseducation deficit has increased in Africa and advanced OECD countries; (iii) the number of countries in poverty traps has risen; and (iv) valuable skills impact most on innovation when physical capital and skills are complementary. The results suggest that public policy ought to pay more attention to the employability of skills.

Item Type: Monograph (Working Paper)
Uncontrolled Keywords: skills, human capital, growth, innovation, diffusion, poverty traps
Subjects: Faculty/School/Research Centre/Department > Centre for Strategic Economic Studies (CSES)
FOR Classification > 1699 Other Studies in Human Society
Depositing User: VUIR
Date Deposited: 13 Dec 2010 22:49
Last Modified: 23 Jan 2015 01:18
URI: http://vuir.vu.edu.au/id/eprint/15934
DOI: CSES Working Paper No. 47
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