Education and economic growth: across regions and Over time

Abstract

This thesis investigates the role of education in economic growth by analyzing a panel of 77 countries, both rich and poor, between the period 1995 and 2015. In particular, by employing fixed effects for global sample and OLS for sub-group samples, this thesis estimates the effect of basic enrollment, tertiary enrollment and education spending on economic growth. Findings suggest that, education spending has significant and positive effect on growth in the short-term in case of high income countries and positive but not significant effect in case of developing countries. Combined primary and secondary enrollment shows almost no association with growth while tertiary enrollment has very small but negative effect on growth. When looking at different field of studies to find out whether science, technology and mathematics profession bring more growth in knowledge economy, result suggest these professions do not exhibit distinct effect over other fields, for instance business and law in the short term. Most interestingly, results imply that healthier population those live long after retirement may distress economic growth of rich and aging societies due to high social spending. On the contrary, there are signs that population growth contribute positively to the economic growth of same countries. In case of low income countries, findings are consistent with existing empirical studies, where population growth is inversely and health is positively associated with per capita income growth.