The Effect On Human Capital Accumulation For The Income Gap

Since Schultz, an American economist, has come up with Human Capital Theoryin the1960s, the idea that human capital accumulation would boost the economicdevelopment and improve people’s living standards is not only accepted by people ofall countries, but also confirmed by the practice of all countries. When people arecheering about human capital which could increase social wealth with such a hugeenergy, they also ignore the fact that it is quietly changing a country’s economicdevelopment on the other side-income distribution structure. In the past20years, thepeople receiving education in our countries doubled repeatedly, human capital stocknearly doubled. However, structural problems of income distribution gradually add up,income inequality is becoming an urgent problem in our country. And how canhuman capital accumulation which is increasing human capital stock effects thepresence of fair income?How can we control this effect?Can we educe the influenceof human capital accumulation to fair income by the data of Mid Area?How can wefind and implement way to narrow the income gap from human capital angle?To resolve these problems, this thesis is based on theories of educationeconomics with qualitative assumptions and quantitative demonstration. It has threeparts:In the beginning is introduction of the whole paper including the goal ofresearch, the background of literature review, and the concept of definition; Thesecond part is a theoretical analyze of duality for the influence of human capitalaccumulation to fair income using Human Capital Theory, Screening Hypothesis andHypotheses of Inverted-U, which comes up with a new Hypotheses of Inverted-Uand finally comes to the conclusion that educational equity is a key factor in the dualinfluence of human capital accumulation to fair income; The third part is aquantitative demonstration using the data of Mid Area which comes to equation ofInverted-U and difference of province’s coefficient by Co-integration test andPanel-data analysis, and illustrates the positive influence of educational equity toincome equality by regressive model, and calculates the future trends and directionsof human capita accumulation and income equality by multinomial fit; The last partoffers some varied advices from the point of compulsory education, middle schooleducation and higher education.