We construct a revised version of the Barro and Lee (1996) data set for a sample of OECD countries using previously unexploited sources and following a heuristic approach to obtain plausible time profiles for attainment levels by removing sharp breaks in the data that seem to reflect changes in classification criteria. It is then shown that these revised data perform much better than the Barro and Lee (1996) or Nehru et al (1995) series in a number of growth specifications. We interpret these results as an indication that poor data quality may be behind counterintuitive findings in the recent literature on the (lack of) relationship between educational investment and growth. Using our preferred empirical specificaction, we also show that the contribution of TFP to cross-country productivity differentials is substantial and that its importance relative to differences in factor stocks increases over time.

We gratefully acknowledge financial support from the European Fund for Regional Development, the Spanish Ministry of Education through CICYT grants SEC99-1189 and SEC99-0820 and the European TNR "Specialization vs. diversification: the microeconomics of regional development and the propagation of macroeconomic shocks in Europe".

Trabajo publicado como artículo en Journal of the European Economic Association 4(1): 1-36 (2006).-- http://dx.doi.org/10.1162/jeea.2006.4.1.1