Human Capital Development and Economic Growth in Bangladesh

Human Capital is an integral part of any country’s development and economic growth has human capital as an important factor. This study empirically evaluates the relevance of human capital development on the growth of the economy pin pointing the relationship that exists between them. In this study, unit root test, Johansson co integration test and ordinary least square (OLS) technique are done. The GDP per capita was used as a proxy for economic growth; Per Capital Gross Domestic Product, primary school enrolment, Secondary school enrollment, tertiary school enrollment, public expenditure on education and health, life expectancy, gross capital formation. From the analysis, it was deduced that there is a strong positive relationship between human capital development and economic growth. Life expectancy is found to be most important variable in this model as it has large impact on economic growth in Bangladesh. Recent time tertiary education has significantly affected the economic growth instead of secondary education. Workable policies should be put in place to bring about an overall economic growth. Expenditures on health and public education should be utilized effectively and efficiently so that the country would experience quality health care services and quality educational system.