created considering the mechanisms, channels, and influence
factors. The model is applied to the European Union members as an example and provided results that confirmed the
existence of positive impacts of human capital (measured by
education) on economic growth in these countries.
Cooray (2009) investigated the impacts of the quantity
and quality of education on economic growth using many
proxy variables in a cross-section sample of low- and
medium-income countries. The result retrieves that education quantity measured by enrolment ratios unambiguously
influences economic growth and indirectly affects government expenditure on economic growth. Jalil and Idrees
(2013) evaluated the level and growth impacts of education
on the economic growth in Pakistan using the data of 1960–
2010. The results of this study clearly provides evidences for
positive impacts of different levels of education on the
economic growth, which confirms that investments in education possibly increase and promote economic growth.
Mallick, Das and Pradhan (2016) found that the impacts
of expenditure on education on economic growth in selected
sample of (14) main countries in Asia (the sample consists of
Saudi Arabia, Pakistan, Bangladesh, India, Sri Lanka, Nepal,
China, Hong Kong Japan, Malaysia, Singapore, Thailand,
Philippines, and Turkey) are positive and statistically significant in all those countries. Moreover, there are short and
long run unidirectional Granger causality resulting from
economic growth to expenditure on education. On the contrary, there is Granger causality of expenditure on education
on economic growth in long runs only and not in the
short-runs in sample. Analysis of the data of the sample as a
group shows positive impact of expenditure on education on
economic growth. That is, the education sector is one of the
important elements of economic growth in all of the sample
countries which should be given high priority, and a reasonable share of total expenditure of the governments should
be allocated to the education sector to improve all levels and
types of education so that the country can utilize skilled
workforce in economic development in the long run.
Başar (2016) explores the impacts of education on economic growth in transition economies during the period
1998–2005; the sample consists of 24 countries. This study
used as proxies for education human capital, education
index, enrollment ratio, and literacy rate, respectively. The
results provide evidence that human capital, education, and
literacy rate positively impact the economic growth, and
effect of human development and literacy rate in the long
run, while enrollment ratio impact is positive and insignificant in the short run. However, the effects of human capital
and literacy are greater than those of physical capital.
Review of studies on the channels by which education
affects economic growth is done by Ding (2017). He shows
that the relation between education and economic growth is
relatively complicated due to the fact that educational economics lag behind the development of economic theory so
that the process of economic growth turn into more complex,
and the process of economic growth is divided into product
function of technological progress, human resource, and
consumption preference. The results show that there are
many ways of how education affects economic growth.
In the meantime, higher education plays a well-known
role in determining the competitiveness of any country or
region. For this reason, Zhu, Peng, and Zhang (2018)
developed a comprehensive proxy for education used to
study the impacts of higher education scale and quality on
economic growth in the six provinces of central China using
panel data during the period 2003–2014. The empirical
results illustrate that higher education scale has significant
positive impact on economic growth of central China; on the
contrary, the impacts of the quality of higher education seem
to have an insignificant impact. Furthermore, technological
innovation has remarkably positive role on economic growth
of provinces of the central China.
Akinwale and Grobler [2019] proved that there is
causality from education and economic growth to trade
openness and from education and trade openness to economic growth, as well as from economic growth and trade
openness to education in the long run. On the opposite side,
there is only causality from trade openness to economic
growth in the short run. The indication of impulse response
function pointed out that economic growth responds more to
trade openness than education. Therefore, increase in governmental expenditure on education as well as the
improvement of trade openness, in particular, are very
important factors to create economic growth in emerging
economies such as South Africa. Therefore, it is recommended that both the continuous expenditure on education
and trade openness are crucial and essential to strengthen
local and institutional capabilities, which positively affect
economic growth and development in South Africa.
The long-run relationship between education and economic growth in Nepal during the period 1995–2013 is
investigated by Nowak and Dahal [2016]. The study pointed
out that the secondary and higher education contribute significantly to the per capita real gross domestic production
(GDP) in Nepal while the impacts of elementary education
are positively influencing economic growth with less significance. However, the results of cointegration test confirmed the presence of long-run relationship between
education and real GDP per capita. This means to keep
education as a top priority in public policies, take serious
efforts to improve the education sector to achieve continued
economic growth.
The Impacts of Education on the Sustainable Development …
271
factors. The model is applied to the European Union members as an example and provided results that confirmed the
existence of positive impacts of human capital (measured by
education) on economic growth in these countries.
Cooray (2009) investigated the impacts of the quantity
and quality of education on economic growth using many
proxy variables in a cross-section sample of low- and
medium-income countries. The result retrieves that education quantity measured by enrolment ratios unambiguously
influences economic growth and indirectly affects government expenditure on economic growth. Jalil and Idrees
(2013) evaluated the level and growth impacts of education
on the economic growth in Pakistan using the data of 1960–
2010. The results of this study clearly provides evidences for
positive impacts of different levels of education on the
economic growth, which confirms that investments in education possibly increase and promote economic growth.
Mallick, Das and Pradhan (2016) found that the impacts
of expenditure on education on economic growth in selected
sample of (14) main countries in Asia (the sample consists of
Saudi Arabia, Pakistan, Bangladesh, India, Sri Lanka, Nepal,
China, Hong Kong Japan, Malaysia, Singapore, Thailand,
Philippines, and Turkey) are positive and statistically significant in all those countries. Moreover, there are short and
long run unidirectional Granger causality resulting from
economic growth to expenditure on education. On the contrary, there is Granger causality of expenditure on education
on economic growth in long runs only and not in the
short-runs in sample. Analysis of the data of the sample as a
group shows positive impact of expenditure on education on
economic growth. That is, the education sector is one of the
important elements of economic growth in all of the sample
countries which should be given high priority, and a reasonable share of total expenditure of the governments should
be allocated to the education sector to improve all levels and
types of education so that the country can utilize skilled
workforce in economic development in the long run.
Başar (2016) explores the impacts of education on economic growth in transition economies during the period
1998–2005; the sample consists of 24 countries. This study
used as proxies for education human capital, education
index, enrollment ratio, and literacy rate, respectively. The
results provide evidence that human capital, education, and
literacy rate positively impact the economic growth, and
effect of human development and literacy rate in the long
run, while enrollment ratio impact is positive and insignificant in the short run. However, the effects of human capital
and literacy are greater than those of physical capital.
Review of studies on the channels by which education
affects economic growth is done by Ding (2017). He shows
that the relation between education and economic growth is
relatively complicated due to the fact that educational economics lag behind the development of economic theory so
that the process of economic growth turn into more complex,
and the process of economic growth is divided into product
function of technological progress, human resource, and
consumption preference. The results show that there are
many ways of how education affects economic growth.
In the meantime, higher education plays a well-known
role in determining the competitiveness of any country or
region. For this reason, Zhu, Peng, and Zhang (2018)
developed a comprehensive proxy for education used to
study the impacts of higher education scale and quality on
economic growth in the six provinces of central China using
panel data during the period 2003–2014. The empirical
results illustrate that higher education scale has significant
positive impact on economic growth of central China; on the
contrary, the impacts of the quality of higher education seem
to have an insignificant impact. Furthermore, technological
innovation has remarkably positive role on economic growth
of provinces of the central China.
Akinwale and Grobler [2019] proved that there is
causality from education and economic growth to trade
openness and from education and trade openness to economic growth, as well as from economic growth and trade
openness to education in the long run. On the opposite side,
there is only causality from trade openness to economic
growth in the short run. The indication of impulse response
function pointed out that economic growth responds more to
trade openness than education. Therefore, increase in governmental expenditure on education as well as the
improvement of trade openness, in particular, are very
important factors to create economic growth in emerging
economies such as South Africa. Therefore, it is recommended that both the continuous expenditure on education
and trade openness are crucial and essential to strengthen
local and institutional capabilities, which positively affect
economic growth and development in South Africa.
The long-run relationship between education and economic growth in Nepal during the period 1995–2013 is
investigated by Nowak and Dahal [2016]. The study pointed
out that the secondary and higher education contribute significantly to the per capita real gross domestic production
(GDP) in Nepal while the impacts of elementary education
are positively influencing economic growth with less significance. However, the results of cointegration test confirmed the presence of long-run relationship between
education and real GDP per capita. This means to keep
education as a top priority in public policies, take serious
efforts to improve the education sector to achieve continued
economic growth.
The Impacts of Education on the Sustainable Development …
271