Research On The Relationship Between Human Capital And Economic Growth In China

The pursuit of long-term economic growth is the everlasting subject of development in human society.From the early scholars' simple abstraction of the growth of total amount of national wealth to the deepening and detailed exploration of the growth by modern economists,people's understanding of growth has gone through profound changes.The traditional growth theory is more concerned with the role of capital,population and other factors in the growth of total output,and corresponding theories such as Harrod-Domer model and neoclassical growth model.However,after the Second World War,the total output in the West has been growing for a long time and previous method can't explain it.The theoretical circles began to pay attention to the new motivation of growth and research of human capital began to prevail.China's economy has experienced more than 30 years' rapid growth and came into a new normal stage,the growth rate gradually fell.Traditional ways that relying on investment and external demand to achieve distinction has been counterproductive.Giving full play to the role of human capital,relying on high quality of workers and knowledge spillover effects to enhance total factor productivity will advance economic restructuring and open a new round of growth.At the same time,most of the current research is exploring the relationship between the growth of human capital and the total output and their data is out of date in recent years.Additionally,further research of different regions is limited,so it is necessary to study these problems.The writing of this paper is mainly divided into literature review,theoretical research,empirical test and policy suggestion.In the first part,the author first combs the development of human capital theory,and then reviews the literature on the relationship between human capital and economic growth.Finally,it reviews the existing literature.In the part of theoretical research,the author first explains the concept of human capital and describes its main form,and analyzes the transformation of the concept of economic growth.Finally,this paper demonstrates how human capital accelerate economic growth from various aspects.In the empirical part,we first introduce the calculation method of human capital stock and the method we have chosen in this paper.Secondly,according to China's provincial panel data we have get from "China Statistical Yearbook" and EPS database from 2005 to 2015,we using stata13 software to test the theory.By analyzing the regression results,we can see that the increase of human capital in our country has brought about the increase of the total output,and the growth effect of the health human capital is more obvious.More importantly,during the eleven years of this paper,the increase in human capital has had a higher effect on output growth than material capital,reflecting the fact that China's economic growth is at a critical transition and the power of growth is changing.This paper makes further study which is make an empirical test on the relationship between human capital and output growth in eastern,middle and western regions.The results show that there is a difference in the effect of human capital to accelerate output growth in different regions,and the role of education and health human capital is different.Educationhuman capital has positive effects on output growth in three regions,with the greatest effect in the eastern region and the least in the western region.However,the relationship between health human capital and economic growth in the eastern region is negative,while in the middle and western regions there is a clear positive correlation.It is important to note that the degree of reliance on human capital and material capital is different in the process of achieve economic growth in different regions.In the western region,the effect of material capital and human capital is close,and the difference is less than that in the eastern and middle regions.Finally,according to the results of empirical test,concerned with the situation and existing problems in China's developing process,this paper puts forward some suggestions.Such as "adapt to local conditions" and develop a scientific human capital development strategy;create multi-channel to accelerate the development of education and health care;improve the structure of human capital and increase investment channels,expand investment in public finance education.