Lifespan and output

This paper develops a finite-lifetime continuous-time model of human capita l acquisition. Exogenous technological progress has two aspects, a knowledg e frontier and an ease-of-learning parameter. We find that as lifespan incr eases: (I) output per person-hour rises in a concave fashion, and (2) learn ing during the work-phase of life only occurs when individuals have a suffi ciently long lifespan. As a result, countries that differ in the average li fespan of their inhabitants can have permanently different levels of output per person even in the presence of free trade, perfect capital markets and common production functions.