Growth and development economics
Mobina Zarei; Seyed Parviz Jalili Kamju; Mahtab Tahmasebi; Ramin Khochiany
Abstract
1-INTRODUCTION
In the economy, education plays an important role in providing highly skilled human capital needed to create jobs, economic growth, and the welfare of individuals and society. Today, most economists believe that the lack of investment in human capital is the main reason for the ...
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1-INTRODUCTION
In the economy, education plays an important role in providing highly skilled human capital needed to create jobs, economic growth, and the welfare of individuals and society. Today, most economists believe that the lack of investment in human capital is the main reason for the low level of economic growth in developing countries, unless these countries use education and knowledge and promote the level of their professional skills. If they do not improve, the productivity and efficiency of labor and capital will remain at a low level and economic growth will be slow and with heavier costs. If the country has the required amount of human capital, it can be said that physical capital will be more productive. Human capital includes education, expertise, skills, and generally the quality of the workforce. Considering that one of the factors influencing the social welfare of countries is achieving a high economic growth rate, the assessment of the causes and factors affecting economic growth is always a special concern of economists, and several growth models have been designed for it.
2- THEORETICAL FRAMEWORK
Undoubtly development is necessary in all societies. Developed and developing countries use the same approach that can only be achieved through educational institutions. Therefore, education plays an effective role in improvement of societies to create continuous development in order to promote social and economic progress. Considering the importance of education costs for the development of countries' economies, it can be said that education costs help create wealth. The argument is that the ability to create, adopt, and improve technological and technical progress is associated with investment in human capital and the functioning of the educational system. Therefore, it is useful for countries to invest significantly in these areas in order to train the workforce and develop the necessary skills to increase economic growth and ensure the success of a country.
ncrease economic growth and ensure the success of a country.
3- MATERIALS & METHODS
The purpose of this research is to evaluate the effect of value-added education, high-level educational expenses and educational quality, trained workforce and capital stock on economic growth among urban households in the provinces of Iran in the period of 2006-2019. This research will use random dynamic panel by application of SAR spatial autoregression generalized moments model and with the use of Arellano-Bauer/Bundle-Band two-stage coefficients in order to estimate the econometric model.
In the spatial econometrics department, by forming the proximity matrix and then standardizing this matrix and finally by multiplying the standardized proximity matrix, a new variable is obtained in the dependent variable vector, which is called the spatial lag variable or the spatial lag variable, and thus with the presence of the lag variable spatial. The spatial econometric model is also dynamically estimated. In summary, all spatial models in the form of a spatial random dynamic panel model (SDPD) are as follows:
4-RESULTS & DISCUSSION
The results obtained from the model indicate that the independent variable of GMM has a positive and significant effect on economic growth, that is, part of the economic growth in these regions is due to their economic growth in the past years. The first spatial interval in the SAR model also has a positive and significant effect on the economic growth of other provinces. The added value of education has a positive and significant effect on economic growth with a coefficient of 0.12, when the added value of education increases, it means that the level of skill, knowledge and talent of the workforce increases, and the structure of the workforce leads to the use of skilled and capable personnel. The effect of human capital on economic growth will increase. Education expenditure also has a positive and significant effect on economic growth with a coefficient of 0.53. One of the ways to increase economic growth is creating a transformation in labor productivity and technological development. Promotion of the level of education requires investment in education and increasing educational facilities. Skilled and thoughtful manpower causes the development and expansion of the technologies produced and as the foundation of economic progress and development in the society, and thus by raising the level of education in the society, growth, the economy also increases. In Smith's main growth equation, labor force, land and capital stock are the main factors of production. Adam Smith explains growth as an endogenous phenomenon, according his point of view, economic growth depends on the decision and action of economic agents, especially their savings and investment behavior. Therefore, the capital stock has a positive and significant effect on economic growth with a coefficient of 0.0001, and the more the capital stock increases, the economic growth also increases. The labor force also has a positive effect on the economic growth of households by increasing it by a factor of 0.25. بیش ا
5- CONCLUSIONS
Based on the discussions of the theoretical foundations and according to the results obtained from the model, it shows that the workforce and the quality of education have a stronger effect on economic growth than the capital stock. In other words, it can be said that economic growth is strongly influenced by the human capital of workers. Therefore, the government should allocate more funds to the education and training organization. Hence the education and training should improve the quality of its schools in various scientific fields, as well as the higher education should raise the quality level of universities in the regions and provinces, especially the deprived areas, and the graduates, in addition to obtaining a degree from their abilities and skills. It is necessary for them to benefit in their educational fields and be able to move them from traditional methods to advanced and modern methods by entering the industry and agriculture sectors and be able to bring their province to high economic growth and development. According to the first spatial break of SAR, the increase in economic growth and development in one province leads to the spillover of economic growth and development to the neighbors’ provinces.
faezeh shadlu; tahereh akhoondzadeh
Abstract
Extended Abstract Introduction Democracy is one types of sovereignty, and its specific aspect is the formal declaration of the principle of the affiliation of a minority with the majority and the recognition of the freedom and the equal rights of individuals and citizens (Alem, 1996: 293). Since Pericles ...
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Extended Abstract Introduction Democracy is one types of sovereignty, and its specific aspect is the formal declaration of the principle of the affiliation of a minority with the majority and the recognition of the freedom and the equal rights of individuals and citizens (Alem, 1996: 293). Since Pericles defined it as "the sovereignty of the people", until today that its consolidation and development in various western schools of thoughts, especially in the United States, is considered as the basic and specialized duty of the government, democracy has gone through major changes. As a result, it could not be studied separately from the economic and social conditions, and the actual and practical situation of society should be taken into consideration. In the final analysis, any democratic structure or system, as a form of political organization of community, serves as a certain mode of production and is determined by it. The theme and form of democracy have been evolved throughout history and has, always and completely, been closely dependent on the related socio-economic formations. In general, democracy is a form of governing that its power source is people, in which the choices of rulers are with the people and government affairs directly or indirectly governed by the people themselves. Economic development and political structure are closely interconnected. The success and duration of every political structure, whether totalitarian or democratic, depends on economic development, economic efficiency, and the quality of the government's economic policies. Real democracy could not be achieved without the equal participation of women in all institutions as well as proper access to education. Methodology This study seeks to examine the impact of economic development, education, and gender equality on democracy among a selection of OPEC countries, including Iran, Saudi Arabia, Kuwait, Venezuela, Qatar, United Arab Emirates, and Algeria, in over 2006-2016 using the generalized method of moments (GMM). The Democracy Index of the Economist Information Unit (EIU), annually shows a general picture of the state of democracy in the world; this index is based on 60 indicators grouped in five different categories measuring election method, pluralism, civil liberties political participation, and political culture. This index covers a range of 1-10 and categorizes countries as one of the four regime types: full democracies (8-10), flawed democracies (6-7/9), hybrid regimes (4-5/9), and authoritarian regimes (less than 4). The Human Development Index (HDI) measures the average achievements in a country in three basic dimensions: health, education, and income. The indicators of these three dimensions are calibrated and combined to generate an HDI score between zero and one. In addition, the percentage of enrollment in primary School (SC) is used as a measure of education. Gender equality is calculated by the percentage of women labor force (LA), the political participation of women in the National Parliament (SE), and the Gender Development Index (GDI). Results and Discussion According to the model estimation results, from the indices measuring economic development, namely GDP per capita and energy use, the former has a negative relationship with democracy while the latter has a positive link with democracy. Negative and meaningfulness of GDP per capita indicate that there is an inverse relationship between oil revenues and the level of democracy and political freedoms in oil-rich countries, as demonstrated by researchers like Friedman (2006) and Wacziarg (2011). In other words, based on these studies and the results of present study, it can be stated that by increasing oil revenues, the level of democracy in oil-rich countries has been reduced. As a result, there is a negative impact on the quality of people’s lives and their social welfare. The positive sign of energy use per capita, as an indicator of consumerism as well as a criterion for increasing economic growth, reflects the fact that people in oil-rich countries, who have a strong tendency to taking advantage of the modern features of the civilized world and are obsessed with new (and probably high-consumption) goods, may welcome democracy as a new commodity. Education also has the task of preparing students for the citizenship of the international community. The more foundation of democracy is been valued at the elementary education, the more the child will be prepared to accept a democratic society. Consequently, the government have to move in the same direction and respond to a generation that has been taught with the principles of democracy from their childhood. There is also a positive relationship between democracy and women's political participation. On the one hand, the real democracy is not realized without full and equal participation of women in all institutions. On the other hand, women’s equal rights in public and political life will fully be recognized just in the presence of democracy. What is evident in the current study is that all of the studied countries have been able to achieve the indicators to some extent by reaching an acceptable level of human and economic development over the studied years. Existence of a positive relationship between some of the above-mentioned factors suggests that the aforementioned countries should create necessary conditions and fundamental institutions to materialize democracy-related goals and public participation, and reduce their focus on oil revenues as much as possible.
