Economics, Econometrics and Finance
a year ago

Government subsidies for human capital lead to more economic growth.

SSRN Electronic Journal
Optimizing Public Investment: Choosing between Physical and Human Capital when the Rate of Return to Physical Capital Exceeds that of Human Capital
Ameyaw Emmanuel

Paper Summary

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The government needs to decide whether to invest in education or physical assets in countries with low development. Research shows that investing in education is better for both economic growth and people's well-being. Subsidizing education leads to more growth than subsidizing physical assets. In these countries, helping people get more education is the best way to improve the economy and make sure everyone benefits.