Note: This is post #83 in a weekly video series on basic economics.
In previous videos in this series, we’ve seen how the accumulation of physical capital only provides a temporary boost to economic growth. Does the same apply to human capital?
To answer that, says Alex Tabarrok of Marginal Revolution University, we should consider: what happens to all new graduates, in the end?
For a while, they’re productive members of the economy. Then age takes its toll, retirement rolls around, and eventually, the old workforce is replaced with a new infusion of people. But then, the cycle restarts. You get a new workforce, everyone’s productive for a while, and then they too retire.
(If you find the pace of the videos too slow, I’d recommend watching them at 1.5 to 2 times the speed. You can adjust the speed at which the video plays by clicking on “Settings” (the gear symbol) and changing “Speed” from normal to 1.25, 1.5 or 2.)
Click here to see other videos in the Introduction to Economics series.