Human Capital Development and Economic Growth: The Nigeria Experience

Abstract

This study employs the augmented Solow human-capital-growth model to investigate the impact of human capital development on national output, a proxy for economic growth, using quarterly time- series data from 1999-2012. Empirical results show that human capital development, in line with theory, exhibits significant positive impact on output level. This implies that human capital development is indispensable in the achievement of sustainable economic growth in Nigeria, as there is an increase in economic performance for every increase in human capital development. The results further reveal a relatively inelastic relationship between human capital development and output level. Going forward, government and policy makers should make concerted and sincere efforts in building and developing human capacity through adequate educational funding across all levels. This remains the major way of attaining sustainable economic growth and development in any economy.