Table of Contents
Economics Research International
Volume 2014, Article ID 646518, 10 pages
Research Article

The Long-Term Impact of Human Capital Investment on GDP: A Panel Cointegrated Regression Analysis

Department of Economics, Faculty of Economic and Administrative Sciences, Sakarya University, Esentepe Campus, 54187 Sakarya, Turkey

Received 30 April 2014; Revised 10 July 2014; Accepted 10 July 2014; Published 5 August 2014

Academic Editor: Thanasis Stengos

Copyright © 2014 Ahmet Gökçe Akpolat. This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.


This study aims to determine the long-run impact of physical and human capital on GDP by using the panel data set of 13 developed and 11 developing countries over the period 1970–2010. Gross fixed capital formation is used as physical capital indicator while education expenditures and life expectancy at birth are used as human capital indicators. Panel DOLS and FMOLS panel cointegrated regression models are exploited to detect the magnitude and sign of the cointegration relationship and compare the effect of these physical and human capital variables according to these two different country groups. As a consequence of panels DOLS and FMOLS models, the impact of physical capital and education expenditures on GDP in the developed countries is determined as higher than the impact in the developing countries. On the other hand, the impact of life expectancy at birth on GDP is determined as higher in the developing countries.