We apply theories of capital market failure to ana1yzeoptima1 financing of risky higher education. In the market solution,students can only finance their education through debt. There isunderinvestment in human capita1, because some students with socia1lyprofitable investments in human capita1...

The paper considers a two-country model of overlapping generations economies with intergenerational transfers carried out in the form of bequest and investment in human capital. We examine in competitive equilibrium the optimal provision of education with and without capital markets integration....

Using years of education as a measure of status, we study the relationship between financial development and intergenerational mobility, focusing on human capital investments boosted by financial deepening. We consider a set of indices to capture different components of the overall...

We present a model that links the division of labor and economic growth with the division of wealth in society. When capital market imperfections restrict the access of poor households to capital, the division of wealth affects individual incentives to invest in specialization. In turn, the...