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Impact of Secondary and Tertiary Education on Economic Growth: a Co-integration Model for Bulgaria

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  • Mariya Neycheva

Abstract

The purpose of this study is twofold. First, it tries to check the hypothesis that human capital stimulates growth of the contemporary economies. Second, it estimates the effects of both secondary and tertiary education on the aggregate activity in the Bulgarian economy over the period 2000-2013. The co-integrating models with a structural break are based on the neoclassical approach to growth. The negative impact of secondary education is clearly expressed. A positive statistically significant result has not been found for tertiary education as well. Moreover, in conformity with the real patterns of development the results confirm that the main drivers of Bulgaria’s growth path àre foreign direct investments and export which keeps its crucial role for the post-crisis development. Òhe unfavorable outcome with regard to education might be explained in light of both the vertical qualification mismatch and the quality of human capital. When the latter is measured by foreign language proficiency, a stronger impact on real GDP per capita in comparison with that for the human capital’s quantity has been derived.

Suggested Citation

  • Mariya Neycheva, 2015. "Impact of Secondary and Tertiary Education on Economic Growth: a Co-integration Model for Bulgaria," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 4, pages 82-106.
    • Handle: RePEc:bas:econst:y:2015:i:4:p:82-106
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    References listed on IDEAS

    as
    1. Irena Zareva, 2012. "Education Training of the Bulgarian Population – Potential for Innovation Development," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 2, pages 103-115.
    2. Jurgen A. Doornik & Henrik Hansen, 2008. "An Omnibus Test for Univariate and Multivariate Normality," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 70(s1), pages 927-939, December.
    3. Алла Кирова & Ирена Зарева & Матю Матев, 2012. "Preservation and Development of Human Capital in Education and Science in Bulgaria (Съхранение и развитие на човешкия капитал в образованието и науката в България) - in Bulgarian," ERI-BAS Books, Bulgarian Academy of Sciences - Economic Research Institute, number 21:p:1-255, October.
    4. Jerik Hanushek & Dennis Kimko, 2006. "Schooling, Labor-force Quality, and the Growth of Nations," Voprosy obrazovaniya / Educational Studies Moscow, National Research University Higher School of Economics, issue 1, pages 154-193.
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    More about this item

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • I20 - Health, Education, and Welfare - - Education - - - General

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