means the output of human capital, and nothing in the definition of output implies
effort or even awareness.)
] agree with Ben-Porath that all consumption and all work should be modeled as self-invested until independence and full-time job entry, given that models must simplify. But I just showed why I model all consumption after, or anyhow after a few months of job training, as Schultz’ pure kind. Here I would fault Mincer and his pupil Becker, but not Schultz or Ben-Porath, for too much focus on the potential of job training. It exists and is crucial. But it is so small a fraction of invested consumption, judging from my experience, that I prefer to neglect it in modeling. Job learning,
conversely, seems to explain all rise in pay with age.
Biology might predict the same. Nature’s plan is that we first develop and then reproduce. Some creatures follow sharply-defined somatic and reproductive phases showing first only development and then only reproduction. A mature butterfly does not eat. It may even lose mouth parts. Its time is spent in reproduction alone. Other creatures including us like eating too, but nature gives them that taste for the sake of the one behind. Adult consumption, as | see it, is more or less all pure consumption exhausted from total capital in satisfying our taste for life and energy. Consumption by the young is invested because that is the big idea. Nature’s plan is
reproduction to maturity.
Now suppose for simplicity that consumption is age-independent. Nobelists Milton Friedman and Franco Modigliani, mentioned earlier for their opposite reactions to my banking idea, separately argued something like that in the 1950s for adults. My extension backward to birth seems defensible when we remember to include unpaid parental care and then schooling in invested consumption. I model human capital as continuing after retirement as present value of implicit pay by ourselves and others for caring for ourselves and those others. Then if adulthood runs from ages 20 to 80, those simplifying assumptions would give pure consumption as three
fourths of all consumption.
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