Today’s world increasingly relies on information and knowledge to drive economic growth, yet to date there has been no publication devoted to the study of human capital. The Journal of Human Capital, which this issue inaugurates, answers the need for a journal focused on this field. The Journal of Human Capital will focus scholarly attention on the role of education, training, and knowledge in the economic life of the individual and the community, and will lead one of the most important discussions of the day.
A revolutionary and controversial concept when first proposed as a major topic of inquiry over four decades ago, human capital theory has evolved into one of the most universally accepted concepts in economics and other social sciences, especially as a driving force in the “new information economy.” Human capital theory has its roots in the fifties, when early applications of the neo-classical growth model revealed that the two classical factors of production, physical capital and labor were no longer sufficient to explain output level and growth. Economists such as Ted Schultz and Jacob Mincer, and later Gary Becker, concluded that the knowledge, education, and skill sets of the workforce—human capital--were the missing category. After a brief backlash from some who believed that what has become known as human capital theory would reduce people to cogs in the machine of a dismal science, this area of economic inquiry has grown more sophisticated as investment has increasingly focused on the knowledge industries. The theory expanded to include all forms of investment in people and knowledge, and their ramifications for employment and production, earning distributions and social mobility, demographic and structural change, and economic growth and development. It is no coincidence that several recent Nobel laureates in economics have devoted major parts of their work to human capital theory. The human capital revolution has shifted the center of attention away from investment in physical capital and physical capital accumulation. People have become the center of the economy.
In placing human beings at the center of its inquiry, the Journal of Human Capital will transcend traditional boundaries. The distinction of the Journal of Human Capital is that it is dedicated to a major theme of economic inquiry, not to a single specialized field of economics. The human capital theme straddles virtually all areas of specialization in economics: micro, macro, trade, education, health, labor, growth and development, market and non-market activities, technological innovation, entrepreneurship, the organization of production, as well as institutional and political change. This is an ambitious agenda of research, and The Journal of Human Capital will surely become one of the most widely discussed publications in the social sciences.
Articles in the first issue:
The first issue begins with an article by Gary Becker and Kevin Murphy entitled “Education and Consumption: The Effects of Education in the Household Compared to the Marketplace.” Becker and Murphy show that the household and the marketplace reward different types of education, and that the return on education behaves differently in each sector. For instance, the household rewards general knowledge, while the workplace is becoming more specialized. At the same time, as education rates rise education holds less value—“the masters degree is the new bachelors”—in the workplace, but households value greater education about issues of importance to the family, such as health and childrearing.
The next article, “The Changing Role of Family Income and Ability in Determining Educational Achievement,” by Philippe Belley and Lance Lochner, challenges current orthodoxy that emphasizes college preparation over student loans. Using data much more recent than other studies, they reveal that students coming from lower income families are now more restricted by finances in their college education options.
Petra Todd and Kenneth Wolpin, meanwhile, take on a perennially controversial subject in “The Production of Cognitive Achievement in Children: Home, School, and Racial Test Score Gaps,” which reports on their attempt to isolate factors that might explain differences in educational performance. They find that a child’s home environment, especially as measured by a mother’s score on the Armed Forces Qualification Test (which is not as dependent on schooling as SATs or other tests), has the largest effect on the gap.
Editor-in-Chief Isaac Ehrlich and Jinyoung Kim round out the first issue with “The Evolution of Income and Fertility Inequalities over the Course of Economic Development: A Human Capital Perspective,” which tackles the dynamic relation between income growth and income inequality in a new light. Ehrlich and Kim argue that the specific dynamic pattern characterizing both growth and inequality stems from the forces responsible for fertility and human capital investments decisions within families, and the resulting spillover of knowledge across families. They show that while fertility inequality becomes more attenuated as countries reach a higher level of development, the pattern of income inequality over the development process mirrors the pattern of inequality in educational attainments in the population.
About the Journal of Human Capital (ISSN: 1932-8575)
Journal of Human Capital is dedicated to human capital and its expanding economic and social roles in the knowledge economy. Developed in response to the central role human capital plays in determining the production, allocation, and distribution of economic resources and in supporting long-term economic growth, JHC is a forum for theoretical and empirical work on human capital—broadly defined to include education, health, entrepreneurship, and intellectual and social capital—and related public policy analyses.
JHC encompasses microeconomic, macroeconomic, and international economic perspectives on the theme of human capital. The journal offers a platform for discussion of topics ranging from education, labor, health, and family economics, to income distribution, social mobility, entrepreneurship and wealth creation, immigration and economic globalization, aging and value of life saving, politics and institutions, crime and corruption, technological innovation and transfer, productivity and structural change, and economic growth and development.
Visit the journal at: www.journals.uchicago.edu/JHC
Journal
Journal of Human Capital