The relationship between education and economic growth

What is it about?

Education is one of the key factors of economic growth. We examine the correlation between growth and education with panel data evidence for 18 post-socialist (PS) and 16 developed market economies (DME) over the 1990–2014 period. Our findings suggest that the pattern of relationship between GDP and measures of tertiary education are different for PS and DME countries and would be interesting to observe when and how the gap between the patterns disappear.

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Why is it important?

Despite the huge amount of researches investigating the relationship between education and GDP as a proxy of well-being, to the best of our knowledge, none of these studies examined a group of post-socialist countries comparing with not post-socialist countries. This paper aims to fill this gap. The goal of this paper is to test two hypotheses: (i) The relationship between GDP per capita and tertiary education’s enrolment rate is stronger in the post-socialist countries than in other countries. (ii) In the post-socialist countries, the relationship between GDP per capita and tertiary education’s enrolment rate is stronger than the relationship between GDP per capita and any other level of education. Correlation analyses confirmed both hypotheses.