Longevity, Human Capital and Domestic Investment
Francisco Parro, Francisco Szederkenyi and Patricio Valenzuela
Abstract
 
This article explores the interaction between aggregate initial human capital, life ex- pectancy and domestic investment. The article introduces a simple model that predicts that the positive effect of life expectancy on the domestic investment rate is mitigated in economies with a higher level of initial human capital. Using a large panel of countries over the past five decades, the article presents empirical evidence consistent with the main prediction of the model.

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