Authors

• Masoud Sadeghi ¹
• Mostafa Emadzadeh ²

¹ Member of Faculty of Administrative Sciences and Economics, Isfahan University

² Associate Professor, Faculty of Administrative Sciences and Economics, Isfahan University

Abstract

This paper focuses on human capital as a determinant of economic growth. In this article empirical evidences relating education to economic growth are examined. In the context of neoclassical growth models, i.e. as in Cobb-Douglas production function, human capital serves as an input to production. These models expand on the neoclassical growth model of Solow, by allowing the output of a country to be an increasing function of its stock of human capital. It is shown that investment in education leads to increased output and therefore growth. Using an Ordinary Least Squares (OLS) regression function, we found that the production elasticities of the skilled labour, non skilled labor, and physical capital are respectively 0.21, 0.49 and 0.35 percentages. Our investigation concludes that schooling has a significant and substantial positive effect on productivity and GDP growth.
 

Keywords

• Human Capital
• Education
• Economic Growth
• investment
• Cobb-Douglas Production Function
• skilled Labour Force