The Impact Of Human Capital On Nigeria's Economic Growth

Abstract

Despite abundant evidence at microeconomic level, the role of human capital in promoting economic growth and development has not been well documented at the macroeconomic level – specifically in developing countries. This paper seeks to examine the role of human capital on economic growth in Nigeria using time series data covering the period from 1970-2019. The data are sourced from Central Bank of Nigeria (CBN) statistical bulletin and World Development Indicators of the World Bank. The data are analyzed using Autoregressive Distributed Lag model (ARDL). The study reveals that expenditure on health and education are found to be positively and significantly related with economic growth both in the short-run and long-run. However, labor negatively impact on economic growth and it was found to be significant. Again, trade openness and inflation are insignificant in explaining economic growth in this paper. Thus, the paper recommends that, Nigerian government should focus on improving the educational and health sector. Meaning that, huge amount of government budgetary allocation should be directed toward educational and health sector. So also, government should create more jobs opportunities (through skills acquisitions/ vocational training) to minimize the unemployment rate in the country.

Impact of Tax Reforms on Economic Growth of Nigeria (2000-2021)

“…Therefore, the researcher concluded that there is a positive significant impact of VAT, CIT, & PPT on HCI in Nigeria. This result is in tandem with Parika and Singh (2020), Matousek and Tzeremes (2019), and Bachama et al (2021), who examined the role of human capital on economic growth in Nigeria using time series data covering the period from, revealed that expenditure on health and education are found to be positively and significantly related with economic growth both in the short-run and long-run.…”

“…The study's key conclusions point to human and physical capital as the primary drivers of economic growth. Bachama et al (2021), used time series data spanning the years 1970-2019 to analyze the impact of economic development on human capital in Nigeria. The Central Bank of Nigeria's (CBN) statistical bulletin and the World Bank's World Development Indicators are the sources of the data.…”

“…The main goal of any economic system, whether it is market-based or centrally planned, is to raise per capita output, which can be done through raising productivity levels. Growth in per capita output is a factor in economic welfare (Bachama et al, 2021). Experience has shown that, in addition to labor and physical capital, human capital is the most significant and promising source of increase in productivity and economic growth.…”

“…It could increase the sustainability of revenue levels and encourage future independence from foreign aid and natural resource earning. Inequality issues can be addressed through income redistribution and behavior change as well as through enhancing economic growth (see Economic growth) (Bachama et al, 2021).…”

Advancing South-South cooperation in education: Indonesian experience with South Africa

“…Economists generally agree that human capital plays a key role in determining economic growth. According to studies, nations with higher levels of human capital typically have higher rates of production and economic success ( Bachama et al , 2022 ). Though complicated, the link between human capital and economic growth can be influenced by other elements such geographical features, economic freedom, and political and social stability ( Duan et al , 2022 ).…”