A Quantitative Analysis of the Role of Human Resource Development in Economic Growth in Pakistan

Abstract

The research paper seeks to find out the role of Human Resource Development (HRD) on Economic Growth of Pakistan. This paper has a quantitative analysis approach. The variables considered indices for Human Resource Development are government expenditures on education and health, primary education enrolment rate, secondary education enrolment rate, tertiary education enrolment rate and gross domestic product. The tool for analysis is the Multiple Regression analysis model particularly on the basis of perceived functional relationship between human resource development and economic growth in Pakistan. Here Gross Domestic Product (GDP) is treating as the explained variable and the others as the explanatory variables; a multiple regression model was specified to form a link between the two variable sets. The data used for study are secondary sources, the model was estimated via ordinary least squares (OLS) techniques, and estimated based on relevant data from the regression output. The result shows that only secondary and tertiary education enrolment rates make use of statistically significant effect on economic growth in Pakistan. The others exerted positive but insignificant effect on economic growth. However, the explanatory variables jointly exerted significant effect on growth. In addition, the model exhibited high explanatory power and indicated absence of first order serial correlation in the explanatory variables. Based on the findings, the study concluded that a clear-cut and obvious relationship existed between Human Resource Development (HRD) and Economic Growth and thus, recommended for strengthen effort in Human Resource Development in Pakistan such as adoption of planned strategies in education and health sectors and increased budgetary allocation to these sectors.

Keywords: Education quality, economic growth, economic development, years of schooling, cognitive skills, skill distribution, human capital