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...man capital are above the threshold, eT, then growth in the economy will be higher the more equal the society, since more dynasties converge to the high steady state. Hence, consistent with evidence (=-=Perotti, 1996-=-; Barro, 1999), income equality generates higher output via its interaction with fertility choice. The effect of changes in the quantity cost parameter, s, on the dynamic system and its steady states ...

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...e rule in either theoretical or empirical analyses. Indeed, following Mincer (1974), many empirical estimates of the returns to education do not assume or find slopes that are infinitely large (e.g., =-=Psacharopoulos, 1994-=-). The assumption that h(0) is strictly positive is reasonable. It implies that when parents invest the minimal level in each child (captured by s), children can supply some labour when they become ad...

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...of parameters restricted by (A1), (A2) and e > ê. An alternative example, more closely related to the commonly assumed Cobb-Douglas human capital production satisfies concavity; see, for instance, (=-=Heckman et al. 1998-=-). Suppose h(e) a)ac(a + e)ac. It is straightforward to verify that the properties of (2) are satisfied. Under this specification multiplicity arises if, for instance, c 2, h 1, s 0.15, b 1/...

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... above the threshold, eT, then growth in the economy will be higher the more equal the society, since more dynasties converge to the high steady state. Hence, consistent with evidence (Perotti, 1996; =-=Barro, 1999-=-), income equality generates higher output via its interaction with fertility choice. The effect of changes in the quantity cost parameter, s, on the dynamic system and its steady states follows from ...