Technology, health, education, and economic growth nexus: evidence from high income OECD countries

Abstract

Human capital and technology, along with physical capital, have been the subject of extensive empirical studies of economic growth since 1980. In this study, we added human capital to the model in the form of health and education, and technology in the form of domestic and foreign technologies. We also divided the education variable into primary, secondary, and tertiary. The research covers 27 high-income OECD countries for the period 1990-2020. In the analysis, the FGLS estimator, which is resistant to heteroscedasticity, cross-section dependence and panel-specific autocorrelation, is employed. As a result, a unit increase in foreign technology increases national income by 0.037%, and a domestic technology by 0.023%. It is clear that foreign technology has higher impact on economic growth compared to the domestic technology. While primary school education has no significant effect on growth, that secondary school education increased growth by ≅0.069% and tertiary by ≅0.30%. Accordingly, it is seen that tertiary education has a much greater effect on economic growth than the effect of physical capital (≅0.22%). It can be said that this situation reveals the importance of tertiary education in the production and spillover of technology.