Abstract
This work investigated the dynamic relationship between higher education and economic growth in Vietnam using annual data collected ten years from 2010 to 2019. The auto-regressive distributive lag framework was used along with the error correction term to investigate the long-run relationship between real gross domestic product, enrollment in higher education, gross capital formation, and labor. The study used the Granger causality test to assess the relationship between higher education and economic expansion. Follow as the test results, a unidirectional causality running from higher education to economic growth have observed. The necessary diagnostic tests have applied to check the reliability and acceptability of model outputs, and they have been found suitable.
Highlights
A high rate of economic growth is one of the foremost aims of all nations
Real GDP, labor, and enrollment in higher education were accessed from the World Bank indicator, while gross capital formation was obtained from the Vietnam Ministry of Finance
Some empirical evidence from across the world asserts the nonexistence of the causal relationship between higher education and economic growth
Summary
A high rate of economic growth is one of the foremost aims of all nations. For an extended period, researchers have been the argument that physical capital matters more for economic growth. According to Becker (1964), Rusli and Hamid (2014), and Devada (2015), human capital is the critical factor in the economic growth attempt of a nation. It is the skills, knowledge, and experience possessed by an individual (Bergheim, 2005). Educational institutions can play a significant role in the economic progress of nations. This statement is reflected in 2006 by Mr Kofi Annan, the former United Nations secretary-general. He argued that Asia's primary driver, Africa's development in the 21st century, must be the university
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