Human Capital Economic Growth And Income Distribution Three Essays On Human Capital

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Human Capital, Economic Growth, and Income Distribution

Author : Chang Gyu Kwag
Publisher :
ISBN 13 :
Total Pages : 414 pages
Book Rating : 4.:/5 (287 download)

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Book Synopsis Human Capital, Economic Growth, and Income Distribution by : Chang Gyu Kwag

Download or read book Human Capital, Economic Growth, and Income Distribution written by Chang Gyu Kwag and published by . This book was released on 1991 with total page 414 pages. Available in PDF, EPUB and Kindle. Book excerpt: Essay one is concerned with how and why an individual invests in human capital and how tax policy affects investment in human capital. We examine optimal investment in human capital and the effect of tax policy on human capital formation, and test several hypotheses derived from the theory using U.S. time-series data. Investment in human capital in terms of college enrollment rates is positively related to family income, rate of return to human capital, and unemployment rates, while it is negatively related to educational cost, and rate of return to physical capital. In addition, the average income tax rates show a negative effect on college enrollment rates. Essay two discusses human capital and economic growth. We first investigate the elasticities of substitution among inputs using the nested constant elasticity of substitution production function to focus on the so-called capital-skill complementarity hypothesis. We here compare two models: one is a model with human capital and raw labor, and the other is a model with higher skilled labor and lower skilled labor. In both models, the elasticities of substitution among inputs are very low, but the complementarity hypothesis is still weakly confirmed. Human capital turns out to be essential in achieving medium-term economic growth empirically. We also demonstrate the key role of human capital in the long-term steady state within the context of the endogenous growth model. Essay three considers the role of human capital on income distribution. Using the nested CES production function, we first derive factor shares, and then examine the relationship between functional and personal income distribution. An increase in share of labor income reduces overall income inequality, while an increase in share of transfer income has a negative effect on income distribution. Human capital, especially primary and secondary level of human capital stock, is a crucial factor in reducing income inequality. Finally, this study develops and presents new estimates of human capital stock in the United States, as well as annual earnings, and labor force by education level for the period 1947-1989. Data shows that the growth rate of GNP is very closely related to that of human capital stock. (Abstract shortened with permission of author.)

Three Essays on the Macroeconomics of Human Capital and Growth

Author : Mercy Laita Palamuleni
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (897 download)

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Book Synopsis Three Essays on the Macroeconomics of Human Capital and Growth by : Mercy Laita Palamuleni

Download or read book Three Essays on the Macroeconomics of Human Capital and Growth written by Mercy Laita Palamuleni and published by . This book was released on 2014 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation encompasses three essays on the macroeconomics of human capital and economic growth. Below are the individual abstracts for each essay. Essay 1: Does Public Education Spending Increase Human Capital? I investigate the effect of public education spending on the quality of human capital as measured by international student test scores in science and mathematics, conditional on the efficiency of a country's governance. Combining World Bank country level data on government efficiency with rich micro data from the OECD PISA-2009, I estimate a human capital production function from student level data. Prior work suggests that public education expenditures are inconsequential for student achievement. I illustrate that public education spending matters for student test scores when one uses student level data instead of aggregate country level data. These results are robust to controlling for governance measures such as corruption control and regulatory quality. An implication is that less efficient government does not preclude improving test scores through education spending. Essay 2: Inequality of Opportunity in Education: International Evidence from PISA. I provide lower-bound estimates of inequality of opportunity in education (IEO) using micro-data from the Programme for International Student Assessment (PISA). The measure represents variation in student mathematics test scores which can be explained by predetermined circumstances (including parental education, gender, and additional community variables). I explore the heterogeneity of the measure at the top and bottom of the test score distribution, and demonstrate that IEO accounts for 10 percent of the variation in test scores for students at the top and bottom of the test score distribution. Using this inequality measure I establish three main conclusions. (1) IEO decreases overall in response to an increase in preprimary enrollment rates. An implication here is that improvements in early childhood education might mitigate the effects of IEO factors for some students. (2) IEO increases in a manner which relates to overall inequality. This indicates the possibility of a more general persistence to inequality factors. An implication is that equity-based education policies can be a key tool for reducing income inequality. (3) There is evidence of an equity-efficiency tradeoff in education. An implication here is that public education policies aimed at reducing IEO might hinder overall education efficiency, in that it decreases academic achievement for some groups of students. Essay 3: Public Education Spending and Economic Growth: The Role of Governance. Although the theoretical literature often connects public education spending to growth, individual empirical findings sometimes conflict. In this paper I propose that inefficiencies in public education spending might explain these inconsistencies. Using a dataset from both developed and developing countries observed over the period of 1995 to 2010, I demonstrate that the efficiency of public education spending on growth depends on a country's level and quality of governance. I also find evidence that increasing educational spending is associated with higher economic growth only in countries that are less corrupt. These findings have important implications for the formation of effective education policies in developing countries. They illustrate that efficient public education spending augments economic growth in a way that increased spending alone does not match.

Three Essays on Human Capital

Author : Yibo Zhang
Publisher :
ISBN 13 :
Total Pages : 122 pages
Book Rating : 4.:/5 (759 download)

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Download or read book Three Essays on Human Capital written by Yibo Zhang and published by . This book was released on 2010 with total page 122 pages. Available in PDF, EPUB and Kindle. Book excerpt: First Chapter: Endogenous Skill Acquisition and Taxation (with James Bullard) This paper studies dynamic Mirrleesian-style taxation in a lifecycle economy. In contrast to the recent Mirrleesian dynamic optimal taxation literature, in which individual skills are subject to shocks but are otherwise fixed over time, agents in our model make a conscious decision about human capital acquisition (as well as when to retire) given their own aptitude for learning. This aptitude is private information. Human capital accumulation is the engine of growth in our model. We find that there will be no human capital accumulation, and hence no growth, in the economy when there is no taxation of any sort. We suggest a taxation scheme which will induce human capital accumulation and hence economic growth in this stylized environment. The key feature of the tax scheme is to provide incentives for human capital accumulation for those that have high aptitude by credibly transferring resources to them later in life, after they have revealed their aptitude. We show that only a moderate transfer is called for to induce growth in our calibrated economy. We also find that the timing of the tax-transfer may or may not matter for the income distribution depending on the exact form in which the taxation is levied (labor or capital income tax), but in general the tax-transfer scheme is highly non-monotonic. Second Chapter: Brain Drain and Brain Drain Reversal Departing from the previous theoretical studies on Brain Drain, which mainly focus on the welfare impact of the migration of skilled workers on the home country and on the foreign country, I build a theoretical model to study a somewhat different twin phenomena "brain drain" and "brain drain reversal". The brain drain and brain drain reversal of interest here is the trend that people from developing countries (most prominently from East Asian countries) who have studied in developed countries such as the U.S. go back to their home country sooner or later for good. I study these two phenomena in a two-period lifecycle economy where home country agents choose not only education location but also work location possibly multiple times in their lifetime. The model captures the crucial factors in agents' location choice decision including work-place premium, education-location premium, market opportunity gap (between home and foreign countries) as well as adaptability of skills. I solve the model analytically and conduct comparative statics analysis followed by calibration exercises based on data from Mainland China (1985-2006). Third Chapter: Human Capital Intensity, Education and Growth (with Jiaren Pang and Haibin Wu) Using the methodology of Rajan and Zingales (1998), we revisit the issue of human capital and economic growth by examining whether industries with higher human capital intensity tend to grow faster in countries with higher human capital stock. Not only are we able to avoid the many problems that have plagued the conventional cross-country growth regressions but the results are no longer mixed. We do not find that education improvement has a differential effect on industries with different human capital intensities. However, we have discovered that in countries with higher education levels and quality, high human capital intensity industries grow faster than low human capital intensity ones.

Human Capital

Author : Gary S. Becker
Publisher : University of Chicago Press
ISBN 13 : 0226041220
Total Pages : 413 pages
Book Rating : 4.2/5 (26 download)

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Book Synopsis Human Capital by : Gary S. Becker

Download or read book Human Capital written by Gary S. Becker and published by University of Chicago Press. This book was released on 2009-05-15 with total page 413 pages. Available in PDF, EPUB and Kindle. Book excerpt: Human Capital is Becker's classic study of how investment in an individual's education and training is similar to business investments in equipment. Recipient of the 1992 Nobel Prize in Economic Science, Gary S. Becker is a pioneer of applying economic analysis to human behavior in such areas as discrimination, marriage, family relations, and education. Becker's research on human capital was considered by the Nobel committee to be his most noteworthy contribution to economics. This expanded edition includes four new chapters, covering recent ideas about human capital, fertility and economic growth, the division of labor, economic considerations within the family, and inequality in earnings. "Critics have charged that Mr. Becker's style of thinking reduces humans to economic entities. Nothing could be further from the truth. Mr. Becker gives people credit for having the power to reason and seek out their own best destiny."—Wall Street Journal

Essays on Growth, Human Capital, and Income Distribution

Author : Valerie Cerra
Publisher :
ISBN 13 :
Total Pages : 398 pages
Book Rating : 4.:/5 (362 download)

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Book Synopsis Essays on Growth, Human Capital, and Income Distribution by : Valerie Cerra

Download or read book Essays on Growth, Human Capital, and Income Distribution written by Valerie Cerra and published by . This book was released on 1996 with total page 398 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Three Essays on the Economics of Human Capital Development

Author : Emma Louise Gorman
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (11 download)

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Book Synopsis Three Essays on the Economics of Human Capital Development by : Emma Louise Gorman

Download or read book Three Essays on the Economics of Human Capital Development written by Emma Louise Gorman and published by . This book was released on 2019 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

THREE ESSAYS CONSIDERING HUMAN CAPITAL COMPOSITION AND ECONOMIC GROWTH

Author : Guan Lin
Publisher :
ISBN 13 :
Total Pages : 145 pages
Book Rating : 4.:/5 (128 download)

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Book Synopsis THREE ESSAYS CONSIDERING HUMAN CAPITAL COMPOSITION AND ECONOMIC GROWTH by : Guan Lin

Download or read book THREE ESSAYS CONSIDERING HUMAN CAPITAL COMPOSITION AND ECONOMIC GROWTH written by Guan Lin and published by . This book was released on 2017 with total page 145 pages. Available in PDF, EPUB and Kindle. Book excerpt: Human capital has long been recognized as a crucial determinant of economic development. The main contribution of my dissertation is to both theoretically and empirically demonstrate the idea that the composition (different types of education) of human capital determines technological progress and affects long-run economic growth. As compared to traditional human capital and growth literature, it emphasizes the composition effect of human capital, rather than the level effect, on economic development. It provides a new perspective in characterizing the stages of economic development along the growth path. Optimal human capital composition benefits not only lesser developed countries who usually lack educational resources but also developed countries with limited population growth potential. The first chapter, titled ``Education, Technology, Human Capital Composition and Economic Development'', develops a framework of endogenous educational decisions and technological progress to explore the human capital composition and its effects on economic growth. In this model, growth is driven by technological advancement, which depends on the human capital composition. Individuals can choose from different types of workers: unskilled workers, generalists or specialists. Both generalists and specialists, through technological progress, are able to enhance growth. The model considers the role of technology stock, coordination cost, education cost and worker's innate ability on the human capital composition and economic growth. The main result shows the improvement in the composition of human capital promotes economic growth in most economic stages. However, this positive effect tapers off as the economy reaches complete specialization. This provides a possible explanation for the convergence of economic growth to zero asymptotically in the long run. I extend the argument into an open economy framework in the second chapter, titled ``Migration Effects on Home Country's Composition of Human Capital and Economic Development''. This chapter examines migration effects on domestic composition of human capital and economic growth. The net effect of migration depends on two facets. On one hand, the possibility of migration provides incentives for workers to invest in education and consequently increases the fraction of skilled workers in home country's human capital composition. On the other hand, increased population of skilled emigrants hinders the accumulation of human capital. A sufficient condition for beneficial migration is derived: if the ex ante domestic fraction of unskilled worker is relatively high, allowing the home country to achieve faster economic growth with migration. The last chapter, titled ``The Effect of Tertiary Education Composition on Economic Growth'', differentiates types of tertiary education by ISECD levels and empirically investigates their effects on economic growth. I use panel data on a group of 77 countries for the period 1998-2011. In dynamic panel data estimation, a potential endogeneity bias could arise due to the inclusion of lagged dependent variables. Several methods are applied to overcome the issue, such as Anderson-Hsiao estimator, the Difference Generalized Method of Moments estimator and the System Generalized Method of Moments estimator. The study shows a significantly positive relationship between short-cycle tertiary education and real GDP per capita for both developed and developing countries. However, undergraduate and graduate education only positively correlate to economic growth in developed countries. The empirical results are informative for developed countries as well as developing countries. Understanding the contribution of tertiary education in different levels allows them to effectively allocate resources and appropriately integrate it in growth policies.

Equity, Human Capital, and Development

Author : Ali Khan
Publisher : JAI Press
ISBN 13 :
Total Pages : 256 pages
Book Rating : 4.X/5 ( download)

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Book Synopsis Equity, Human Capital, and Development by : Ali Khan

Download or read book Equity, Human Capital, and Development written by Ali Khan and published by JAI Press. This book was released on 1981 with total page 256 pages. Available in PDF, EPUB and Kindle. Book excerpt: Monograph essays examining the effects of human capital development on income distribution and economic and social development - discusses poverty measurement, the likely implications of economic growth, effects of guaranteed income on education and educational level, impact of inflation on welfare, etc., develops an economic model incorporating growth and education, and includes case studies. Graphs and references.

Three Essays on Human Capital

Author : Xiaoyan Chen Youderian
Publisher :
ISBN 13 :
Total Pages : pages
Book Rating : 4.:/5 (86 download)

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Book Synopsis Three Essays on Human Capital by : Xiaoyan Chen Youderian

Download or read book Three Essays on Human Capital written by Xiaoyan Chen Youderian and published by . This book was released on 2012 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: The first essay considers how the timing of government education spending influences the intergenerational persistence of income. We build a life-cycle model where human capital is accumulated in early and late childhood. Both families and the government can increase the human capital of young agents by investing in education at each stage of childhood. Ability in each dynasty follows a stochastic process. Different abilities and resultant spending histories generate a stochastic steady state distribution of income. We calibrate our model to match aggregate statistics in terms of education expenditures, income persistence and inequality. We show that increasing government spending in early childhood education is effective in lowering intergenerational earnings elasticity. An increase in government funding of early childhood education equivalent to 0.8 percent of GDP reduces income persistence by 8.4 percent. We find that this relatively large effect is due to the weakening relationship between family income and education investment. Since this link is already weak in late childhood, allocating more public resources to late childhood education does not improve the intergenerational mobility of economic status. Furthermore, focusing more on late childhood may raise intergenerational persistence by amplifying the gap in human capital developed in early childhood. The second essay considers parental time investment in early childhood as an education input and explores the impact of early education policies on labor supply and human capital. I develop a five-period overlapping generations model where human capital formation is a multi-stage process. An agent's human capital is accumulated through early and late childhood. Parents make income and time allocation decisions in response to government expenditures and parental leave policies. The model is calibrated to the U.S. economy so that the generated data matches the Gini index and parental participation in education expenditures. The general equilibrium environment shows that subsidizing private education spending and adopting paid parental leave are both effective at increasing human capital. These two policies give parents incentives to increase physical and time investment, respectively. Labor supply decreases due to the introduction of paid parental leave as intended. In addition, low-wage earners are most responsive to parental leave by working less and spending more time with children. The third essay is on the motherhood wage penalty. There is substantial evidence that women with children bear a wage penalty of 5 to 10 percent due to their motherhood status. This wage gap is usually estimated by comparing the wages of working mothers to childless women after controlling for human capital and individual characteristics. This method runs into the problem of selection bias by excluding non-working women. This paper addresses the issue in two ways. First, I develop a simple model of fertility and labor participation decisions to examine the relationships among fertility, employment, and wages. The model implies that mothers face different reservation wages due to variance in preference over child care, while non-mothers face the same reservation wage. Thus, a mother with a relatively high wage may choose not to work because of her strong preference for time with children. In contrast, a childless woman who is not working must face a relatively low wage. For this reason, empirical analysis that focuses only on employed women may result in a biased estimate of the motherhood wage penalty. Second, to test the predictions of the model, I use 2004-2009 data from the 1997 National Longitudinal Survey of Youth (NLSY97) and include non-working women in the two-stage Heckman selection model. The empirical results from OLS and the fixed effects model are consistent with the findings in previous studies. However, the child penalty becomes smaller and insignificant after non-working women are included. It implies that the observed wage gap in the labor market appears to overstate the child wage penalty due to the sample selection bias.

Studies in Human Capital

Author : Jacob Mincer
Publisher : Edward Elgar Publishing
ISBN 13 : 9781782541554
Total Pages : 456 pages
Book Rating : 4.5/5 (415 download)

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Book Synopsis Studies in Human Capital by : Jacob Mincer

Download or read book Studies in Human Capital written by Jacob Mincer and published by Edward Elgar Publishing. This book was released on 1993-01-01 with total page 456 pages. Available in PDF, EPUB and Kindle. Book excerpt: 'The books should. . . . be bought by every university library. The research reported here is important, the exposition is lucid, the sequencing of chapters is sensible and the retrospective aspect of the volumes provides a fascinating insight into the working methods of one of the great economists of our time.' - Geraint Johnes, International Journal of Manpower Studies in Human Capital, the first volume of Jacob Mincer's essays to be published in this series, assesses the impact of education and job training on wage growth. It offers an authoritative study of the effects of human capital investments on labor turnover and the impact of technological change on human capital formation.

Investment in Human Capital, Labor Mobility and Inequality

Author : Elisabeth Magnani
Publisher :
ISBN 13 :
Total Pages : 320 pages
Book Rating : 4.:/5 (51 download)

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Book Synopsis Investment in Human Capital, Labor Mobility and Inequality by : Elisabeth Magnani

Download or read book Investment in Human Capital, Labor Mobility and Inequality written by Elisabeth Magnani and published by . This book was released on 1996 with total page 320 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Human Capital and Economic Growth

Author : Alberto Bucci
Publisher : Springer Nature
ISBN 13 : 3030215997
Total Pages : 384 pages
Book Rating : 4.0/5 (32 download)

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Book Synopsis Human Capital and Economic Growth by : Alberto Bucci

Download or read book Human Capital and Economic Growth written by Alberto Bucci and published by Springer Nature. This book was released on 2019-11-26 with total page 384 pages. Available in PDF, EPUB and Kindle. Book excerpt: This edited collection explores the links between human capital (both in the form of health and in the form of education), demographic change, and economic growth. Using empirical as well as theoretical perspectives, the authors investigate several important issues in the context of human capital, namely population ageing, inequality, public policy, and long-term economic development. Ultimately, they demonstrate that the accumulation of human capital is of crucial importance to long-run economic growth.

Three Essays on Race and Human Capital

Author : Daniel M. Kreisman
Publisher :
ISBN 13 : 9781267472601
Total Pages : 145 pages
Book Rating : 4.4/5 (726 download)

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Book Synopsis Three Essays on Race and Human Capital by : Daniel M. Kreisman

Download or read book Three Essays on Race and Human Capital written by Daniel M. Kreisman and published by . This book was released on 2012 with total page 145 pages. Available in PDF, EPUB and Kindle. Book excerpt: The following presents three essays on racial disparities in human capital investments and returns to skill over the life-cycle. The first chapter, “The Source of Black-White Inequality in Early Language Acquisition: Evidence from Early Head Start, ” addresses the source and timing of divergence in the accumulation of early childhood skills between black and white children. The second chapter, “The Effects of the Jeanes and Rosenwald Funds on Black Education by 1930: Comparing Returns on Investments in Teachers and Schools,” estimates the combined and comparative effects of two large philanthropies targeting rural black schools in the segregated South. The third chapter, “Blurring the Color Line: Wages and Employment for Black Males of Different Skin Tones,” co-authored with Marcos Rangel, tests for wage differentials within race, across skin color, utilizing a measure of skin tone placed in a prominent social survey. Taken together, these essays evaluate the role race plays in inequality above and beyond what can be explained away by racial disparities in wealth, family circumstances, prior education and other comparable measures. Each essay is written from a human capital perspective, drawing on literature in economics, public policy and education, seeking to broaden our understanding of the incongruous relationship between race and inequality in America.

Human Capital Distribution, Technological Progress, and Economic Growth

Author : Oded Galor
Publisher :
ISBN 13 :
Total Pages : 66 pages
Book Rating : 4.X/5 (2 download)

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Book Synopsis Human Capital Distribution, Technological Progress, and Economic Growth by : Oded Galor

Download or read book Human Capital Distribution, Technological Progress, and Economic Growth written by Oded Galor and published by . This book was released on 1994 with total page 66 pages. Available in PDF, EPUB and Kindle. Book excerpt:

The Distribution of Human Capital and Economic Growth

Author : Oded Galor
Publisher :
ISBN 13 :
Total Pages : 94 pages
Book Rating : 4.3/5 ( download)

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Book Synopsis The Distribution of Human Capital and Economic Growth by : Oded Galor

Download or read book The Distribution of Human Capital and Economic Growth written by Oded Galor and published by . This book was released on 1996 with total page 94 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Human Capital and the Personal Distribution of Income

Author : Gary Stanley Becker
Publisher :
ISBN 13 :
Total Pages : 86 pages
Book Rating : 4.:/5 (43 download)

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Book Synopsis Human Capital and the Personal Distribution of Income by : Gary Stanley Becker

Download or read book Human Capital and the Personal Distribution of Income written by Gary Stanley Becker and published by . This book was released on 1967 with total page 86 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Essays on Human Capital, Health, and Development

Author : Yao Yao
Publisher :
ISBN 13 :
Total Pages : 119 pages
Book Rating : 4.:/5 (958 download)

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Book Synopsis Essays on Human Capital, Health, and Development by : Yao Yao

Download or read book Essays on Human Capital, Health, and Development written by Yao Yao and published by . This book was released on 2016 with total page 119 pages. Available in PDF, EPUB and Kindle. Book excerpt: This dissertation studies rich lifecycle behavior concerning human capital and health, and its implications for economic growth and development. It examines the impact of social institutions and government policies on individuals' lifetime choices which affect public health outcomes and economy-wide labor productivity. I apply macroeconomic approach and focus on aggregate effects, but both theoretical framework and quantitative analysis are built upon solid micro foundations of household behavior. By exploring the underlying channels, I derive policy implications for economic growth and development. This dissertation consists of three chapters. Chapter 1 studies the role of fertility motives in women's HIV risk in Sub-Saharan Africa, Chapter 2 studies the impact of higher education expansion along with economic reform on Chinas labor productivity, and Chapter 3 explores patterns of Chinas regional income disparity. Chapter 1 examines the role of social and cultural norms regarding fertility in women's HIV risk in Sub-Saharan Africa. Fertility, or the ability to bear children, is highly valued in most African societies, and premarital fertility is often encouraged in order to facilitate marriage. This, however, increases women's exposure to HIV risk by increasing unprotected premarital sexual activity. I construct a lifecycle model that relates a woman's decisions concerning sex, fertility and education to HIV risk. The model is calibrated to match Kenyan womens data on fertility, marriage and HIV prevalence. Quantitative results show that fertility motives play a substantial role in women's, especially young women's, HIV risk. If premarital births did not facilitate marriage, the HIV prevalence rate of young women in Kenya would be one-third lower. Policies that subsidize income, education, and HIV treatment are evaluated. Chapter 2 studies the impact of higher education expansion, along with economic reform of the state sector, in the late 1990's in China on its labor productivity. I argue that in an economy such as China, where allocation distortions widely exist, an educational policy affects average labor productivity not only through its effect on human capital stock, but also through its effect on human capital allocation across sectors. Thus, its impact could be very limited if misallocation becomes more severe following the policy. I construct a two- sector general equilibrium model with private enterprises (PE) and state-owned enterprises (SOE), with policy distortions favoring the latter. Households, heterogeneous in ability, make educational choices and occupational choices in a three-period overlapping-generations setting. Counterintuitively, quantitative analysis shows an overall negative effect of higher education expansion on average labor productivity (by 5 percent). Though it did increase China's skilled human capital stock significantly (by nearly 50 percent), the policy had the effect of reallocating relatively more human capital toward the less-productive state sector. It is the economic reform that greatly improves the efficiency of human capital allocation and complements educational policy in enhancing labor productivity (by nearly 50 percent). Chapter 3 explores patterns of China's regional income disparity. I document the stylized fact that the regional labor income disparity varies across industries with different skill in- tensities in China. While high-skill-intensive industries have larger income dispersions across regions than low-skill-intensive ones, this pattern tends to intensify over recent decades. I construct a model that interprets this pattern using the regional productivity variation of high-skilled firms, match-specific ability, firms' screening decision and workers' migration. In particular, firms in rich regions have higher productivity than those in poor regions. Workers are heterogeneous in ability, which is match-specific and unobservable before screening. Since ability and productivity are complements for high-skilled firms, these firms in rich regions pay more screening efforts to select workers with higher ability, and pay a higher wage in equilibrium. Workers live in different regions, and migration incurs a cost. This increases la- bor market tightness in rich regions and amplifies the regional income disparity. The model is quantified to match China's data. Counterfactual analysis shows that the screening process accounts for 45 percent of China's regional income disparity of high-skill-intensive industries, and migration barrier accounts for 10 percent.