TY - JOUR
T1 - Social status, education, and growth
AU - Fershtman, Chaim
AU - Murphy, Kevin M.
AU - Weiss, Yoram
PY - 1996/2
Y1 - 1996/2
N2 - This paper investigates the implications of social rewards on the allocation of talent in society and consequently on the process of economic growth. We consider two sources of heterogeneity among workers: nonwage income and innate ability. A greater emphasis on status may induce the "wrong" individuals, that is, those with low ability and high wealth, to acquire schooling, causing workers with high ability and low wealth to leave the growth-enhancing industries. This crowding-out effect, taken alone, discourages growth. Growth may be enhanced by a more egalitarian distribution of wealth, which reduces the demand for status.
AB - This paper investigates the implications of social rewards on the allocation of talent in society and consequently on the process of economic growth. We consider two sources of heterogeneity among workers: nonwage income and innate ability. A greater emphasis on status may induce the "wrong" individuals, that is, those with low ability and high wealth, to acquire schooling, causing workers with high ability and low wealth to leave the growth-enhancing industries. This crowding-out effect, taken alone, discourages growth. Growth may be enhanced by a more egalitarian distribution of wealth, which reduces the demand for status.
UR - http://www.scopus.com/inward/record.url?scp=0030478859&partnerID=8YFLogxK
U2 - 10.1086/262019
DO - 10.1086/262019
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AN - SCOPUS:0030478859
SN - 0022-3808
VL - 104
SP - 108
EP - 132
JO - Journal of Political Economy
JF - Journal of Political Economy
IS - 1
ER -
