January 2002

AIDS and the Accumulation and Utilization of Human Capital in Africa

This paper outlines the likely effects of the AIDS pandemic in Africa on the continent’s ability to produce education and use it effectively for growth and poverty reduction. The authors argue that as the epidemic reduces domestic savings, as well as foreign investment, it will erode the physical capital stocks. This in turn would reduce the skill premium, which would negatively impact both, the rate of growth and social productivity of the human capital stock.

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