|Type||Working Paper - World Bank Policy Research Working Paper|
|Title||Economic growth, education, and AIDS in Kenya: a long-run analysis|
The AIDS epidemic threatens Kenya with a long wave of premature adult mortality, and thus
with an enduring setback to the formation of human capital and economic growth. To investigate
this possibility, we develop a model with three overlapping generations, calibrate it to the
demographic and economic series from 1950 until 1990, and then perform simulations for the
period ending in 2050 under alternative assumptions about demographic developments, including
the counterfactual in which there is no epidemic. Although AIDS does not bring about a
catastrophic economic collapse, it does cause large economic costs – and very many deaths.
Programs that subsidize post-primary education and combat the epidemic are both socially
profitable – the latter strikingly so, due to its indirect effects on the expected returns to education
– and a combination of the two interventions profits from a modest long-run synergy effect.
|»||Kenya - Welfare Monitoring Survey 1994|