Governance thresholds and the human capital–growth nexus

Journal article


Apergis, Nick, Mustafa, Ghulam and Khan, Muhammad 2021. Governance thresholds and the human capital–growth nexus. Journal of Economic Studies. https://doi.org/10.1108/JES-03-2021-0150
AuthorsApergis, Nick, Mustafa, Ghulam and Khan, Muhammad
Abstract

The literature that explores the relationship between human capital and economic growth has produced mixed results. It highlights the puzzle on the correlations between human capital and economic growth. This study contributes to this debate by offering an explanation of the puzzling effects. Using the threshold model proposed by Kremer et al. (2013), the results document that there is a threshold effect in the human capital–growth nexus. The findings illustrate that the relationship between human capital and economic growth is weakly positive up to a certain threshold level of governance; however, the relationship turns out to be positive once the threshold level has been achieved. The mixed evidence on the human capital–growth relationship can be explained through institutional quality differences. The findings recommend that better governance is complementary to contribute to the productive use of human capital in achieving higher economic growth.

KeywordsHuman capital; Economic growth; Governance; Nonlinear modeling
Year2021
JournalJournal of Economic Studies
PublisherEmerald
ISSN0144-3585
Digital Object Identifier (DOI)https://doi.org/10.1108/JES-03-2021-0150
Web address (URL)https://www.emerald.com/insight/content/doi/10.1108/JES-03-2021-0150/full/html?skipTracking=true
hdl:10545/626058
Output statusPublished
Publication dates20 Oct 2021
Publication process dates
Deposited26 Oct 2021, 14:11
Accepted22 Sep 2021
ContributorsUniversity of Piraeus, Piraeus, Greece, University of Derby, Queen Mary University of London, UK and IQRA University, Islamabad, Pakistan
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