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Human Capital and Economic Growth: Pakistan, 1960-2003

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  • Qaisar Abbas

    ()
    (Comsats Institute of Information Technology, Islamabad, Pakistan & Cardiff Business School, Cardiff University, UK.)

  • James Foreman-Peck

    ()
    (Cardiff Business School, Cardiff University.)

Abstract

This paper investigates the relationship between human capital and economic growth in Pakistan with aggregate time series data. Estimated with the Johansen (1991) approach, the fitted model indicates a critical role for human capital in boosting the economy’s capacity to absorb world technical progress. Much higher returns, including spillovers, to secondary schooling in Pakistan than in OECD economies is consistent with very substantial education under-investment in Pakistan. Similarly, extremely large returns to health spending compare very favorably with industrial investment. Human capital is estimated to have accounted for just under one-fifth of the increase in Pakistan’s GDP per head. Since the 1990s, the impact of deficient human capital policies is shown by the negative contribution to economic growth.

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Bibliographic Info

Article provided by Department of Economics, The Lahore School of Economics in its journal Lahore Journal of Economics.

Volume (Year): 13 (2008)
Issue (Month): 1 (Jan-Jun)
Pages: 1-27

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Handle: RePEc:lje:journl:v:13:y:2008:i:1:p:1-27

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Keywords: Human Capital; Economic Growth; Cointegration; Pakistan;

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Cited by:
  1. Faisal Sultan Qadri, Faisal & Dr. Abdul Waheed, Waheed, 2011. "Human Capital and Economic Growth: Time Series Evidence from Pakistan," MPRA Paper 30654, University Library of Munich, Germany.
  2. Jalil, Abdul & Idrees, Muhammad, 2013. "Modeling the impact of education on the economic growth: Evidence from aggregated and disaggregated time series data of Pakistan," Economic Modelling, Elsevier, vol. 31(C), pages 383-388.

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