Formal Education in the European Union and Its Impact on the Macroeconomic Development

This paper focuses on various statistical methods to analyze the impact of formal education on the macroeconomic development in Romania and in other EU member states. Generally speaking, the research reveals two trends which are driven, on the one hand, by the need for increased investments in education that generates further benefits and revenue on the long time and contributes to social development, too, and, on the other hand, by the need for quality education, since knowledge plays a key role in the modern society, leading to growth and prosperity. The study begins with the presentation of international developments and challenges in today’s world, especially in the education sector. In order to analyze the relationship between the economic and the educational indicators provided by EUROSTAT and to focus on developments in certain countries, we used data for 28 countries, i.e. 27 EU member states and the EU average, during 2001-2015. The study uses two statistical methods, i.e. the exploratory method (Principal Components Analysis) and the inferential method (multiple regression). Performing PCA, we came to the conclusion that gross domestic product is strongly influenced by total public expenditure on education and employment rates of tertiary graduates.