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Human Capital-Economic Growth Nexus: A Causality Analysis for Pakistan

Author

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  • Khan, Jangraiz
  • Khattak, Naeem Ur Rehman Khattak
  • Khan, Amir

Abstract

This paper concentrates on the role of human capital in economic growth of Pakistan during the period 1971-2012.Granger Causality test has been used as analytical technique for this purpose. The study used research and development (R&D), education and health as proxies for human capital. The results confirm the role of human capital in the economic growth of the study area. The results show that human capital in form of research and development (R&D) Granger caused economic growth during the study period. Moreover, unidirectional causal relationships exist among different levels of education, physical capital, R&D and economic growth. Realizing the significance of human capital for sustained economic growth of the country, it is suggested to increase investment in R&D, health and education sector of Pakistan.

Suggested Citation

  • Khan, Jangraiz & Khattak, Naeem Ur Rehman Khattak & Khan, Amir, 2015. "Human Capital-Economic Growth Nexus: A Causality Analysis for Pakistan," MPRA Paper 65689, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:65689
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    Cited by:

    1. Abla A. H. Bokhari, 2017. "Human Capital Investment and Economic Growth in Saudi Arabia: Error Correction Model," International Journal of Economics and Financial Issues, Econjournals, vol. 7(4), pages 104-112.

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    More about this item

    Keywords

    Causality; Human Capital; Research and Development; Physical Capital; Economic Growth;
    All these keywords.

    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J2 - Labor and Demographic Economics - - Demand and Supply of Labor
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O49 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Other

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