Human Capital, Economic Structure and Growth

Human capital is usually viewed as one of the key determinants of competitiveness and economic growth. However, recent statistical data about unemployment and growth in EU have revealed some weak spots of this traditional view. The human capital itself seems not to be a guarantee of economic stability and presumable quick recovery from crisis. On the contrary we see countries like Spain or Cyprus where the level of human capital, expressed as a percentage of tertiary educated population, is relatively very high but the unemployment reaches critical levels and economic growth is weak or negative. In this article we continue with our previous research and show that human capital must reflect the economic structure to foster the economic growth. Otherwise it might only cause higher level of unemployment due to crowding out effect and imbalances on the labor market. We also deal with responses of regional economies on recent economic crisis, when we show asymmetric responses based on structural differences and human capital endowment. (C) 2014 Elsevier B.V.