The Influence Of Education Investment On China's Economic Growth

With the development of our country's economy,education plays an increasingly important role in national development and.As an important way for human capital,education can significantly promote the economic growth of countries and regions.This view has been recognized by most economists.China's higher education has developed rapidly since the 1990s.With the increase of enrollment in universities,the number of college graduates has also increased.However,the employment rate of university graduates has been declining in recent years.The rationality of the structure of investment in education in China(the proportion of investment in higher education,secondary education,and primary education)has become the focus to discuss.In this context,this paper conducts an empirical analysis of the impact of China's education investment on economic growth,and puts forward recommendations on the rational allocation of education investment and education investment structure based on empirical results,which has important practical significance.This paper mainly studies the impact of China's education investment on economic growth.And analyzes the positive correlation between education investment and economic growth.On this basis studies the elasticity coefficient of education investment to economic growth.This paper collates the provincial panel data of 30 provinces in the country from 1997 to 2015(except for Tibet province).Under the growth regression model,an individual fixed effect regression model is constructed in the panel data.Using Eviews 10.0 to analyze the investment in education on China's economic growth.In this paper,I use the budgetary expenditure of public finance education in our country divided by the total number of people in the region to form per capita investment in education to study the contribution of investment in education to the overall economic growth in China.Adopting the proportion of China's higher education investment in secondary education investment and primary education investment as the proxy variable of the education investment structure.At the same time,the square of the education investment structure is included to study whether there is an inverted U-shaped structural relationship between China's education investment structure and economic growth.In order to verify the reasonableness of China's higher education investment.The research direction is mainly divided into two aspects.First,empirical analysis of the national sample by construct four different models.In addition to the study of the impact of China's education investment on economic growth(Model 1),and on this basis,two variables of the education investment structure(Model 2)are used to study the rationality of the structure of education investment in China.At the same time,in addition to studying the impact of current investment in education on current economic growth.The education investment,education investment structure,and the square of education investment structure are lagging behind by one period(Model 3)and two periods(Model 4).Secondly,sub-regional samples are used for empirical analysis.The national sample is divided into the four major regions of the eastern,central,western,and northeastern regions for differences analysis.The different elasticity coefficients of education investment for economic growth in different regions are studied.And analysis the education investment in each region is reasonable or not.Analysis of regional education investment structure differences and the reasons for these differences.Through empirical research,the main conclusions are as follows:(1)According to the analysis results of the national sample,education investment can have a positive correlation effect on economic growth.When per capita education investment increases by 1%,it can increase the per capita GDP by 0.269%.After joining the two variables of education investment structure and its square item,the results show that the education investment in our country has appeared an inverted U-shaped structure.So increasing in education expenditure on higher education does not significantly promote economic growth.After lagging the first-stage and second-stage regressions of variables such as education investment,it was found that investment in education can still significantly promote economic growth.It can verify the lag in investment in education.At the same time,it shows that there is no direct causal relationship between education investment and economic growth.So investment in education should not pay too much attention on the current rate of return.(2)According to the analysis results of sub-regional samples,education investment in the eastern,western,central,and northeast regions can significantly promote economic growth.However,the degree of influence varies.Among them,the western region has the highest coefficient of elasticity,the central region has the lowest coefficient of elasticity,and the eastern and northeast regions are both above and below the national average.Judging from the structure of investment in education,there is a clear inverted U-shaped structure in the eastern region.This may be due to the fact that universities tend to be saturated and that there are serious talent spillovers effect in universities.The central region has not yet achieved the optimal investment structure.The investment in higher education in the central region will still promote regional economic growth.The inverted U-shaped structure also appeared in the western regions.Maybe not achieve an ideal return on investment,resulting in inverted U-shaped education investment structure.The possible reason is that it is difficult for the western region to attract talents to contribute to economic development.Education structure and its square are not significant in Northeast.Based on the conclusions drawn from empirical research,the following suggestions are made for the education investment and education investment structure in China:1.Increase investment in education and give full play to the leading role of education in economic development.2.Consider the rational allocation of educational resources and the proportion of education investment.3.Drawing on the experience of education investment in developed countries,diversify the sources of investment in education.4.Optimize regional industrial structure and improve education contribution rate.5.Pay attention to the cultivation of talents and adhere to the strategy of"prospering the country with science and education".