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dc.contributor.author Ponzetto, Giacomo A. M.
dc.contributor.author Troiano, Ugo
dc.date.accessioned 2024-02-06T12:25:40Z
dc.date.available 2024-02-06T12:25:40Z
dc.date.issued 2024-06-26
dc.identifier.uri http://hdl.handle.net/10230/58966
dc.description.abstract This paper shows that social capital increases economic growth by raising government investment in human capital through better political incentives and selection. We provide empirical evidence that a greater share of output is spent on public education where social capital is higher, both across countries and across U.S. states. We develop a theoretical model of stochastic endogenous growth with imperfect political agency. Only some people correctly anticipate the future returns to current spending on public education. Greater social discusion of information makes this knowledge more wide-spread among voters. As a result, social capital alleviates myopic political incentivesto underinvest in human capital. It also helps voters select politicians who ensure high productivity in public education. Through this mechanism, we show that social capital raises the equilibrium growth rate of output and reduces its volatility.
dc.format.mimetype application/pdf
dc.language eng
dc.language.iso eng
dc.title Social capital, government expenditures and growth
dc.type info:eu-repo/semantics/workingPaper
dc.subject.keyword Social capital
dc.subject.keyword Education expenditure
dc.subject.keyword Economic growth
dc.subject.keyword Elections
dc.subject.keyword Government expenditure
dc.subject.keyword Imperfect Information
dc.rights.accessRights info:eu-repo/semantics/openAccess

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