The Impact of Human Capital on Economic Growth: the Case of Mexico

Jorge Garza-Rodriguez, Natalia Almeida-Velasco, Susana Gonzalez-Morales, Alma P. Leal-Ornelas

Research output: Contribution to journalArticle

Abstract

In this article, we estimate the relationship between human capital and economic growth for the case of Mexico for the 1971–2010 period. Using an ordinary least squares model and also an ordinary least squares model with structural change, it was found that the independent variables used in the model explain up to 50% of the variability of GDP per worker. The results of the estimated regressions indicated that a 1% change in the gross enrollment ratio at the secondary level leads to a 1.08% increase in GDP per worker. Similarly, a 1% increase in the differences in capital investment as a percentage of GDP leads to a 0.39% increase in GDP per worker. These results show that the impact of human capital on Mexico’s economic growth is significantly greater than that of physical capital, since the estimated coefficients of human capital are almost three times of those of physical capital. Also, the results of the Granger causality test indicated the existence of a bidirectional causality between human capital and economic growth in Mexico.
Original languageEnglish
Pages (from-to)1-16
Number of pages16
JournalJournal of the Knowledge Economy
DOIs
Publication statusPublished - 11 Oct 2018

Fingerprint

Economic growth
Mexico
Human capital
Workers
Physical capital
Ordinary least squares
Capital growth
Structural change
Capital investment
Coefficients
Granger causality test
Causality
Enrollment

Cite this

Garza-Rodriguez, Jorge ; Almeida-Velasco, Natalia ; Gonzalez-Morales, Susana ; Leal-Ornelas, Alma P. / The Impact of Human Capital on Economic Growth: the Case of Mexico. In: Journal of the Knowledge Economy. 2018 ; pp. 1-16.
@article{4d18dcf8718e48da9ee4a788f8e0af76,
title = "The Impact of Human Capital on Economic Growth: the Case of Mexico",
abstract = "In this article, we estimate the relationship between human capital and economic growth for the case of Mexico for the 1971–2010 period. Using an ordinary least squares model and also an ordinary least squares model with structural change, it was found that the independent variables used in the model explain up to 50{\%} of the variability of GDP per worker. The results of the estimated regressions indicated that a 1{\%} change in the gross enrollment ratio at the secondary level leads to a 1.08{\%} increase in GDP per worker. Similarly, a 1{\%} increase in the differences in capital investment as a percentage of GDP leads to a 0.39{\%} increase in GDP per worker. These results show that the impact of human capital on Mexico’s economic growth is significantly greater than that of physical capital, since the estimated coefficients of human capital are almost three times of those of physical capital. Also, the results of the Granger causality test indicated the existence of a bidirectional causality between human capital and economic growth in Mexico.",
author = "Jorge Garza-Rodriguez and Natalia Almeida-Velasco and Susana Gonzalez-Morales and Leal-Ornelas, {Alma P.}",
year = "2018",
month = "10",
day = "11",
doi = "10.1007/s13132-018-0564-7",
language = "English",
pages = "1--16",
journal = "Journal of the Knowledge Economy",
issn = "1868-7865",
publisher = "Springer Verlag",

}

The Impact of Human Capital on Economic Growth: the Case of Mexico. / Garza-Rodriguez, Jorge; Almeida-Velasco, Natalia; Gonzalez-Morales, Susana; Leal-Ornelas, Alma P.

In: Journal of the Knowledge Economy, 11.10.2018, p. 1-16.

Research output: Contribution to journalArticle

TY - JOUR

T1 - The Impact of Human Capital on Economic Growth: the Case of Mexico

AU - Garza-Rodriguez, Jorge

AU - Almeida-Velasco, Natalia

AU - Gonzalez-Morales, Susana

AU - Leal-Ornelas, Alma P.

PY - 2018/10/11

Y1 - 2018/10/11

N2 - In this article, we estimate the relationship between human capital and economic growth for the case of Mexico for the 1971–2010 period. Using an ordinary least squares model and also an ordinary least squares model with structural change, it was found that the independent variables used in the model explain up to 50% of the variability of GDP per worker. The results of the estimated regressions indicated that a 1% change in the gross enrollment ratio at the secondary level leads to a 1.08% increase in GDP per worker. Similarly, a 1% increase in the differences in capital investment as a percentage of GDP leads to a 0.39% increase in GDP per worker. These results show that the impact of human capital on Mexico’s economic growth is significantly greater than that of physical capital, since the estimated coefficients of human capital are almost three times of those of physical capital. Also, the results of the Granger causality test indicated the existence of a bidirectional causality between human capital and economic growth in Mexico.

AB - In this article, we estimate the relationship between human capital and economic growth for the case of Mexico for the 1971–2010 period. Using an ordinary least squares model and also an ordinary least squares model with structural change, it was found that the independent variables used in the model explain up to 50% of the variability of GDP per worker. The results of the estimated regressions indicated that a 1% change in the gross enrollment ratio at the secondary level leads to a 1.08% increase in GDP per worker. Similarly, a 1% increase in the differences in capital investment as a percentage of GDP leads to a 0.39% increase in GDP per worker. These results show that the impact of human capital on Mexico’s economic growth is significantly greater than that of physical capital, since the estimated coefficients of human capital are almost three times of those of physical capital. Also, the results of the Granger causality test indicated the existence of a bidirectional causality between human capital and economic growth in Mexico.

UR - http://www.mendeley.com/research/impact-human-capital-economic-growth-case-mexico

U2 - 10.1007/s13132-018-0564-7

DO - 10.1007/s13132-018-0564-7

M3 - Article

SP - 1

EP - 16

JO - Journal of the Knowledge Economy

JF - Journal of the Knowledge Economy

SN - 1868-7865

ER -