HIGHER EDUCATION AND ECONOMIC GROWTH: AN EMPIRICAL STUDY OF PAKISTAN

Abstract

Generally, Education is considered as human capital which is contributing positively to economic prosperity and growth. The research paper attempts to identify a relationship between different disciplines of higher education and economic development of Pakistan for the period of 1990-2017 using the Cobb-Douglas production function. The application of ordinary least square methodology examined the long-run relationship between higher education and Pakistan’s economic development. The empirical study found that in the long-run higher education has strong impact on economic growth of Pakistan. Seven academic disciplines are selected to observe the impact of educational categorization i.e. Medical, Engineering, law, commerce, home economics, Education, and Agriculture. Estimated results revealed a positive and significant impact of getting higher education on Pakistan’s economic growth where the role of engineering and medical sciences was found prominent among all of the selected disciplines with respect to economic development. The findings of the study validate the assumption that human capital and economic growth are strongly correlated in Pakistan in the long run. However, there is a dire need to focus on research and development to enable the country to face competitiveness in the contemporary world and to adopt to the robust technological innovations. Research and Development institutions in Pakistan should pay attention on high-tech and scientific research so as to expedite economic development in the country.