Human capital accumulation and economic growth in Malaysia - Investigating the long run nexus

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3 Citations (Scopus)

Abstract

The endogenous growth theory emphasises that human capital is crucial to a country's economic growth. The purpose of the present study is to investigate the long term relationship between human capital and economic growth in Malaysia for the period between 1981 and 2010. Based upon the results of the autoregressive distributed lag (ARDL) model employed, the findings indicate that a long run relationship exists between the education level of the labour force and economic growth. Among all education levels, labour with high educational attainment (secondary and tertiary) contributed positively to economic growth. The present study recommends further investment in higher education following the successful experience of many developed countries in order to propel Malaysia towards achieving its ambition of being recognised as a high income country.

Original languageEnglish
Pages (from-to)155-165
Number of pages11
JournalJurnal Ekonomi Malaysia
Volume48
Issue number1
Publication statusPublished - 2014

Fingerprint

Human capital accumulation
Malaysia
Economic growth
Human capital
Education
Income
Long-run relationship
Capital growth
Labor force
Endogenous growth theory
Long-term relationships
Educational attainment
Developed countries
Autoregressive distributed lag model
Labor economics
Labor

Keywords

  • Autoregressive distributed lag approach (ARDL)
  • Economic growth
  • Educational attainment
  • Human capital
  • Labour

ASJC Scopus subject areas

  • Business, Management and Accounting (miscellaneous)

Cite this

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AB - The endogenous growth theory emphasises that human capital is crucial to a country's economic growth. The purpose of the present study is to investigate the long term relationship between human capital and economic growth in Malaysia for the period between 1981 and 2010. Based upon the results of the autoregressive distributed lag (ARDL) model employed, the findings indicate that a long run relationship exists between the education level of the labour force and economic growth. Among all education levels, labour with high educational attainment (secondary and tertiary) contributed positively to economic growth. The present study recommends further investment in higher education following the successful experience of many developed countries in order to propel Malaysia towards achieving its ambition of being recognised as a high income country.

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