Measuring the Contribution of Human Capital to the development of Catalan Factory System (1830-61)

Abstract

The article argues that for a region adopting a technology from elsewhere, an existing stock of (relevant) human capital was essential to the rapid and successful adoption of the technology. But once the technology has been fully assimilated, increments to human capital would not be expected to be important in its further growth. Thus, Catalan industrialisation was possible because the level of human capital present in industry was enough to adopt and modify new technologies. Human capital stock was mainly the result of past investments in on-the-job training, and children's informal education took place in the workplace rather than the schoolroom. Therefore, the level of human capital present in the workforce was higher than literacy and schooling rates showed. However, evidence is also presented on the low contribution made by human capital to growth rates.