The role of human and public capital in the Spanish regions growth:a panel
In this work we observe the role of public and human capital through
an extended version of the Solow model,and we test its main implication that in the
long run growth is only drived by technological progress which is exogenous.We
estimate a panel data with fixed effects and we obtain several interesting results.First,
we obtain favourable conclusions about the predictive capacity of the Solow model
for the Spanish regions and that the main restriction of the model holds.However,we
find evidence against the other basic prediction of the Solow model that the long run
growth rate is only determined by technological progress that is exogenous.The prin-
cipal reason is the observed strong correlation between the growth rates of the labour
force and production per worker.We also obtain a relevant role of human capital.
Second,we elaborate a measure of the rate of growth of the Total Factor Productivity
(TFP)using the Divisia-Tornqvist index and we find that it is independent of the
investment in private capital and the growth rate of labour force.Its only appear
weakly significant the investment in human and public capital variables.This result
could be consistent with the prediction of the Solow model.
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