The Effect of Education on Economic Growth

The economy will grow if the necessity of getting a higher education is reinforced. Education is the foundation of a country’s economic growth and the key to rid a nation of poverty. To illustrate, Japan is a country with no resources, but since it has a good educational system; Japan has the second richest economy worldwide. On the other hand, Nigeria is a country that is rich in resources, but low in education; as a result, the majority of people there are poor. A higher education creates a quality workforce,; besides it will promote economic stability by growing and training students for success. Such training will capacitate hard working people, which will do well to The United States economy. The government should invest more of its money on helping those students that cannot afford college. It will capacitate people who will

It is commonly accepted in theory and in empirical results, that in general, a higher level of education will yield a higher wage (Acemoglu and Autor 2011). In recent years there are studies to suggest that the importance of education has increased (Atkinson 2008). Goldin and Katz (2007) found that the economic returns of completing high school today appear substantial and the economic benefits to college and post-college schooling are at historically high levels. Additionally, the wages of US individuals that have a postgraduate degree have increased significantly since 1979. Although a number of studies points towards education in itself not being relevant to the wage level but that education acts as a signal of ability to employers (Jeager and Page 1996).

There is a strong emphasis on education in most developed countries, and it's no secret that education has a drastic effect on a country's economy. Someone

As stated by Riddell, human capital is often referred to as the skills, competencies, and knowledge that one possesses, including both cognitive skills and non-cognitive skills. Human capital can be largely determined or influenced by your environment and it is essential to individual and social well being. As a result, most people tend to place great consumption value on education based on the belief that acquiring an education can result in many private benefits such as higher earnings and better health. Human capital formation and education specifically, play an important role in the economy and society as a whole, as it largely affects the labour market. Education provides individuals with equal opportunity to better themselves and climb the social ladder, and often results in enhanced productivity and economic growth if used effectively. However, investment in education is risky as there is great uncertainty as to

economic growth enables a society become more open, tolerant, and politically democratic, the societies are, in turn, more able to attract enterprise and creativity and therefore can

Csintalan, C., & Badulescu, A. (2015). Education and Human Capital as Engines for Economic Growth. A Literature Review. Annals Of The University Of Oradea, Economic Science Series, 24(2), 665-673.

Education is seen as the gateway to economic well being, making the quality of the education provided a more important issue in need of attention in both developed and developing countries. Economic growth and poverty reduction cannot prevail without an educated and skilled workforce. In developing countries, one additional year of education adds approximately 10 percent to a person’s earnings (A Global Impact on Learning 2011). Thus it is imperative that developing countries invest in the education of its people so that its entire country can prosper.

College education also has a good effect on the economic growth of a country. College students after graduating get employed by companies when Employees get higher wages and more productivity is going on in a country, it is an indication that a country’s economy is good. “A study by Federal Reserve economists examined the factors contributing to greater state prosperity over a 65-year period and found that a state’s college attainment rates were important factors in explaining its per capita income growth relative to other states between 1939 and 2004”( www.epi.org). This shows that if people go to college and after graduating get a job, they will probably work for a company and will become productive for the country’s economy. “A country 's economy becomes more productive as the proportion of educated workers increases, since educated workers are able to more efficiently carry out tasks that require literacy and critical thinking” (ww.investopedia.com). It is very important for every country to emphasis on college education because it helps a country grow faster. Also, educated people have more productive mind than uneducated people. Less educated people are being denied by companies. (www.net.educause.edu) This shows that companies with higher demands do not hire less educated people and this is a negative point for a country’s economy. Moreover, in the year 2014 4.3 percent of college graduates have increased compared to 2010 (www.nscresearchcenter.org). In year 2014,

Extensive development studies also categorize a substantial positive connection between escalating education and populace wellbeing; yet several, particularly the initial ones, did not regulate other elements, for example economic growth, which could also be related to improved health. As a result, it is commonly advised that the relationship amid growing education and

Krugman (1994) summarizes two sources of growth that help to expand the national economy. They are increasing input and increasing output per unit of input. Because of the diminishing return to capital, increasing input can only increase the output level in the long run. Therefore, increasing input, such as increasing employment opportunities, increasing the education level of workers, and increasing the stocks of physical capitals, is not sustainable in the long run. On the other hand, increasing the knowledge, which belongs to the increasing output per unit of input, increases the output growth rate in the long run. Krugman concludes that only technological progress can affect the growth rate of steady state in the long run.

Having a high education is one of the largest factors for saving money and helping the economy. Children with a higher literacy rate pay fewer taxes, earn more money, and are less susceptible to commit a crime (Calman and Tarr-Whelan 2). Having children with a good background in school helps the economy. These children are more likely to get jobs, work efficiently, and buy things (Calman and Tarr-Whelan 2). By being educated you save money and with that money they are able to buy things they want, which boost the economy. Children that have an early education save time and money by not needing extra or special classes that can be costly (Calman and Tarr-Whelan 4). Inadequate education in young children leads to excessive spending that is not necessary or is unsuccessful (Trostel 1). Not only does an early education give development and literacy skills, it also helps you save money down the

Adelman, I. (1961). Theories of economic growth and development (1st ed.). Stanford, Calif.: Stanford University Press.

To conclude, economic growth is quite clearly beneficial for global economies in the present day. There is great improvement in the standard of living, rising unemployment, greater business confidence and potential environmental benefits due to

The improvement in the education sector promotes the stability of the economy since the educated citizens have better payrolls. The societal economies have a chance to develop with increased educated people. The whole nation benefits from education because they influence the economic growth of a country. Hence, higher education provides the citizens with a chance for economic growth. Higher education gives the citizens an opportunity to lead happy and healthy lives. This is because, with training, a person can earn a decent pay and as a result improve personal lives. With the knowledge that comes from education, people know the importance of societal activities, which allows them to enhance their lives and as a result make a positive impact on the world (Johnson et al., 2015). Education provides people with essential skills that give them an opportunity to participate in societal and cultural activities. Hence, people lead successful and fulfilling lives. In addition to improving the daily lives of a person, higher education helps to promote the lifestyles of the whole nation. Hence, higher education provides the citizens with an opportunity to lead healthy and better lives.

There is no denying to the fact that in today 's competitive era education has become a major part not only for human kinds but also for a country development because it is play an important role in a country 's social and economic progress. If a person wants to get success and progress in his life he should be educated. In the same way if a nation wants development, the country should has more developed education and educated people which leads a country towards the prosperity. Today there are many countries on earth which we can call developed nations like, the united state of America, Canada, England and many more. These are the developed countries and the reason behind that is education. Education gives strength to a country 's development through the women empowerment, improvements in the field of science and technology and improvements in public Health care.