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Relationship Between Human Capital And Economic Growth: An Application To Developing Countries

Author

Listed:
  • Ali Altiner

    (Recep Tayyip Erdoðan University, Turkey)

  • Yilmaz Toktas

    (Amasya University, Turkey)

Abstract

High and sustainable economic growth, that is an important indicator of life quality, is an essential condition in the realization of economic growth. In this regard, achieving strong economic growth in developing countries which mostly need development today, is one of the most debated topics. For many years, physical capital has been recognized as the most important determinant of economic growth. New approaches to economic growth have been developed since 1980s. In this context, according to endogenous growth theory, it is stated that the most important determinant of economic growth is the human capital stock. Today, while the subject of economic growth is examined, the effect of human capital on economic growth is intensively investigated. In this study, the impact of human capital on economic growth for selected 32 developing countries is investigated by panel data analysis method using data from the period 2000-2014. The focus of the study is also the direction and degree of effect of the increase in the level of education on economic growth. According to empirical analysis results, it is founded that human capital positively affects economic growth. It has also been found that its positive effect on economic growth has reduced while the education level has increased. On the other hand, the results of the analysis indicate that physical capital has a positive impact and that the labor negatively affects economic growth in the studied countries. However, it has been determined that the effect of human capital on economic growth is lower than that of physical capital.

Suggested Citation

  • Ali Altiner & Yilmaz Toktas, 2017. "Relationship Between Human Capital And Economic Growth: An Application To Developing Countries," Eurasian Journal of Economics and Finance, Eurasian Publications, vol. 5(3), pages 87-98.
    • Handle: RePEc:ejn:ejefjr:v:5:y:2017:i:3:p:87-98
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    Citations

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    Cited by:

    1. Mohammad Mafizur Rahman & Xuan-Binh (Benjamin) Vu & Son Nghiem, 2022. "Economic Growth in Six ASEAN Countries: Are Energy, Human Capital and Financial Development Playing Major Roles?," Sustainability, MDPI, vol. 14(8), pages 1-17, April.
    2. Zarish Riaz & Uzma Nisar, 2022. "Impact of Human Capital and Social Capabilities on Economic Growth of Pakistan: A Time Series Analysis," Journal of Education and Social Studies, Science Impact Publishers, vol. 3(1), pages 18-30.
    3. Chibuzor Happinessobi, 2023. "A Gender Analysis of the Impact of Human Capital Development on Economic Growth in Nigeria," Working Papers of the African Governance and Development Institute. 23/042, African Governance and Development Institute..
    4. Chibuzor Happinessobi, 2023. "A Gender Analysis of the Impact of Human Capital Development on Economic Growth in Nigeria," Working Papers 23/042, European Xtramile Centre of African Studies (EXCAS).
    5. Suleman Sarwar & Dalia Streimikiene & Rida Waheed & Zouheir Mighri, 2021. "Revisiting the empirical relationship among the main targets of sustainable development: Growth, education, health and carbon emissions," Sustainable Development, John Wiley & Sons, Ltd., vol. 29(2), pages 419-440, March.
    6. Bosede Ngozi Adeleye & Ismail Bengana & Abdelaziz Boukhelkhal & Mohammad Musa Shafiq & Hauwah K. K. Abdulkareem, 2022. "Does Human Capital Tilt the Population-Economic Growth Dynamics? Evidence from Middle East and North African Countries," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 162(2), pages 863-883, July.
    7. Chibuzor Happinessobi, 2023. "A Gender Analysis of the Impact of Human Capital Development on Economic Growth in Nigeria," Working Papers of The Association for Promoting Women in Research and Development in Africa (ASPROWORDA). 23/011, The Association for Promoting Women in Research and Development in Africa (ASPROWORDA).

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