Notes on Using Human Capital and Household Production Models in Less-Developed Countries,

The application to less-developed countries LDCs of human capital and household production models that were formulated for analysis of developed economies holds much promise. But the transfer will not be easy. Apart from the well-known problems of transforming concepts of income, labor force, and saving into operational constructs in LDC settings, a variety of other differences will surely emerge as human capital economists increasingly study the determinants and consequences of investments in children, health, nutrition, schooling, training, and migration in LDCs. In this note, the consequences are briefly explored for surveying and research of three such differences that have emerged prominently in earlier research. These differences are related only in that each concerns a facet of family behavior that differs significantly and systematically between most developed and most underdeveloped countries, and in that each difference must often be accounted for to avoid bias or irrelevance in studying LDC family behavior with the usual kit of human capital or household production models.