Improvement in information and private investment in education

Eckwert B, Zilcha I (2010)
JOURNAL OF ECONOMIC DYNAMICS & CONTROL 34(4): 585-597.

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Zeitschriftenaufsatz | Veröffentlicht | Englisch
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Abstract / Bemerkung
This paper uses the framework of an OLG economy for an analysis of the dynamic interaction between the precision of information about individual skills, investment in education, human capital accumulation, and social welfare. The human capital of an individual depends on both his (subjectively) random ability and his investment in education. Individual investment in education is financed through a loan contract with income-contingent terms of repayment. Investment decisions are based on public signals (test outcomes) which screen all agents for their abilities. We find that better information, which allows more efficient screening, enhances aggregate human capital formation but may, at the same time, stifle aggregate investment in education. Moreover, social welfare may increase or decline depending on the transformation technology and on the relative measure of risk aversion. (C) 2009 Elsevier B.V. All rights reserved.
Erscheinungsjahr
Zeitschriftentitel
JOURNAL OF ECONOMIC DYNAMICS & CONTROL
Band
34
Zeitschriftennummer
4
Seite
585-597
ISSN
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Eckwert B, Zilcha I. Improvement in information and private investment in education. JOURNAL OF ECONOMIC DYNAMICS & CONTROL. 2010;34(4):585-597.
Eckwert, B., & Zilcha, I. (2010). Improvement in information and private investment in education. JOURNAL OF ECONOMIC DYNAMICS & CONTROL, 34(4), 585-597. doi:10.1016/j.jedc.2009.10.012
Eckwert, B., and Zilcha, I. (2010). Improvement in information and private investment in education. JOURNAL OF ECONOMIC DYNAMICS & CONTROL 34, 585-597.
Eckwert, B., & Zilcha, I., 2010. Improvement in information and private investment in education. JOURNAL OF ECONOMIC DYNAMICS & CONTROL, 34(4), p 585-597.
B. Eckwert and I. Zilcha, “Improvement in information and private investment in education”, JOURNAL OF ECONOMIC DYNAMICS & CONTROL, vol. 34, 2010, pp. 585-597.
Eckwert, B., Zilcha, I.: Improvement in information and private investment in education. JOURNAL OF ECONOMIC DYNAMICS & CONTROL. 34, 585-597 (2010).
Eckwert, Bernhard, and Zilcha, Itzhak. “Improvement in information and private investment in education”. JOURNAL OF ECONOMIC DYNAMICS & CONTROL 34.4 (2010): 585-597.