Empirical analysis of human capital development and economic growth in Europe

Recent discussion of the knowledge-based economy draws increasingly attention to the role that the creation and management of knowledge plays in economic development. Development of human capital, the principal mechanism for knowledge creation and management, becomes a central issue for policy-makers and practitioners at the regional, as well as national, level. Facing competition both within and across nations, regional policy-makers view human capital development as a key to strengthening the positions of their economies in the global market. Against this background, the aim of this study is to go some way towards answering the question of whether, and how, investment in education and vocational training at regional level provides these territorial units with comparative advantages. The study reviews literature in economics and economic geography on economic growth (Chapter 2). In growth model literature, human capital has gained increased recognition as a key production factor along with physical capital and labour. Although leaving technical progress as an exogenous factor, neoclassical Solow-Swan models have improved their estimates through the inclusion of human capital. In contrast, endogenous growth models place investment in research at centre stage in accounting for technical progress. As a result, they often focus upon research workers, who embody high-order human capital, as a key variable in their framework. An issue of discussion is how human capital facilitates economic growth: is it the level of its stock or its accumulation that influences the rate of growth? In addition, these economic models are criticised in economic geography literature for their failure to consider spatial aspects of economic development, and particularly for their lack of attention to tacit knowledge and urban environments that facilitate the exchange of such knowledge. Our empirical analysis of European regions (Chapter 3) shows that investment by individuals in human capital formation has distinct patterns. Those regions with a higher level of investment in tertiary education tend to have a larger concentration of information and communication technology (ICT) sectors (including provision of ICT services and manufacture of ICT devices and equipment) and research functions. Not surprisingly, regions with major metropolitan areas where higher education institutions are located show a high enrolment rate for tertiary education, suggesting a possible link to the demand from high-order corporate functions located there. Furthermore, the rate of human capital development (at the level of vocational type of upper secondary education) appears to have significant association with the level of entrepreneurship in emerging industries such as ICT-related services and ICT manufacturing, whereas such association is not found with traditional manufacturing industries. In general, a high level of investment by individuals in tertiary education is found in those regions that accommodate high-tech industries and high-order corporate functions such as research and development (R&D). These functions are supported through the urban infrastructure and public science base, facilitating exchange of tacit knowledge. They also enjoy a low unemployment rate. However, the existing stock of human and physical capital in those regions with a high level of urban infrastructure does not lead to a high rate of economic growth. Our empirical analysis demonstrates that the rate of economic growth is determined by the accumulation of human and physical capital, not by level of their existing stocks. We found no significant effects of scale that would favour those regions with a larger stock of human capital. The primary policy implication of our study is that, in order to facilitate economic growth, education and training need to supply human capital at a faster pace than simply replenishing it as it disappears from the labour market. Given the significant impact of high-order human capital (such as business R&D staff in our case study) as well as the increasingly fast pace of technological change that makes human capital obsolete, a concerted effort needs to be made to facilitate its continuous development.

A new strategy for selecting and evaluating physical solvents for gas absorption

This work describes how the physical properties of a solvent affect the design variables of a physical gas absorption process. The role of every property in determining the capital and the running cost of a process has been specified. Direct mathematical relationships have been formulated between every item of capital or running cost and the properties which are related to that item. The accuracy of the equations formulated has been checked by comparing their outcome with some actual design data. A good agreement has been found. The equations formulated may be used to evaluate on the basis of economics any suggested new solvents. A group of solvents were selected for evaluation. Their physical properties were estimated or collected as experimental data. The selected ones include three important solvents, the first is polyethylene glycol dimethyl ether (Selexol) which represents the currently most successful one, The other two solvents are acetonyl acetone (B2) and n-formyl morpholine which have been suggested previously as potential credible alternatives to the current ones. The important characteristics of: acetonyl acetone are its high solubility and its low viscosity, while the n-formyl morpholine is characterised by its low vapour pressure and its high selectivity. It was found that acetonyl acetone (B2) is the most attractive solvent for commercial applications particularly for process configurations that:include heat exchangers and strippers. The effect of the process configuration on the selected solvent was investigated in detail and it was found that there is no universal solvent which is the best for any process configuration, but that there is a best solvent for a given process configuration. In previous work, acetonyl acetone was suggested as a commercially promising physical solvent. That suggestion was not fully based on experimental measurement of all the physical properties. The viscosity of acetonyl acetone and its solubility at 1 atm were measured but the vapour pressure and the solubility of C02 and CH4 at high pressure were predicted. In this work, the solubilities of C02, CH4 and C3H8 in acetenyl acetone were measured for a partial pressure range of (2 ~ 22) bar at 25°C, The vapour pressure of this solvent was also measured, and the Antoine equation was formulated from tbe experimental data. The experimental data were found to be not In agreement with the predicted ones, so acetonyl acetone was re-evaluated according to the experimental data. It was found that this solvent can be recommended for further trials in a pilot plant study or for small scale commercial units.