The Incubator of Human Capital: The NBER and the Rise of the Human Capital Paradigm
The human capital construct is deep in the bones of economics and finds reference by many classical economists, even if they did not use the phrase. The term “human capital,” seldom mentioned in economics before the 1950s, increased starting in the 1960s and blossomed in the 1990s. The upsurge in NBER publications was even greater. Using EconLit codes from 1990 to 2019, the use of human capital among NBER books increased from 5% to 25%, whereas all economics books changed from 3% to 6%. For NBER working papers, 3% referenced human capital around 1990, but 10% have more recently. The figures for all economics articles are 4% and 6%. The NBER played an outsized role in the rise of the concept of human capital mainly because of the emphasis on empiricism at the NBER. We explore how the NBER was an incubator of human capital research and the ways human capital theory brought the NBER into the modern era of economics.
Presented at the session “NBER and the Evolution of Economic Research, 1920-2020” at the 2020 AEA Meetings in San Diego CA. We thank our discussant James Heckman and Stanley Engerman for constructive comments and Jennifer Walsh for locating Library of Congress codes for all NBER volumes. We dedicate this paper to Martin Feldstein, whose vision brought the NBER into the modern age and made 1050 Massachusetts Avenue the meeting place for economists and an incubator of human capital. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.