Learning-by-doing versus Schooling in a Model of Endogenous Growth

Byline: Matthias Gocke (1) Keywords: human capital; learning-by-doing; schooling; leisure; endogenous growth Abstract: A two sector model of learning-by-doing measured by means of production aggregated over time and of human capital accumulation in a schooling sector is presented. Time utilization is rival between schooling and learning-by-doing. Depending on the sum of elasticities of the accumulated factors (i.e., of production experience and educational human capital) in both sectors, a situation with or without endogenous growth results. Dynamic optimization of the choice between leisure and working and of the division of human capital between education and production is executed. Transitional dynamics are analyzed for a Cobb-Douglas example and a numerical simulation is performed. Author Affiliation: (1) Institut fur Industriewirtschaftliche Forschung, Universitat Munster, Universitatsstrasse 14-16, 48143, Munster, Germany Article History: Registration Date: 01/01/2003 Received Date: 29/11/2001 Online Date: 08/03/2004 Article note: JEL classification: C61, D90, O41. Acknowledgements The author would like to thank Eric C. Meyer and two anonymous referees for helpful comments. The usual caveats apply. revised version received November 23, 2003