An Analysis of the Impact of Human Capital on the Economic Growth of Pakistan

Abstract

Pakistan is a country on its course to advancement but during this period of growth, it has faced some significant dilemmas. Therefore, a study has been conducted with the aim to examine the impact of the e of human capital formation, interest rate, exports and capital formation on the economic growth of Pakistan GDP has been taken as the dependent variable to measure growth.  Data was collected from 1972 to 2013. ADF has been applied to check stationarity between the variables. ARDL econometric approach has been used for co-integration among variables’ is also applied for short run dynamics among the variables. The results finds that there is a positive and significant relationship between human capital and GDP.  For increasing GDP, the government should reduce the economic misery index and increase human capital, capital formation, and exports in Pakistan. This study has several limitations. First, it is conducted in a developing nation context i.e., Pakistan, where it is required in the future to be conducted with same factor among different developing nations of the region.