Impact of Education and Technology on Economic Growth

The purpose of this study is to examine the impact of education and technology on economic growth. Countries can increase the efficiency of labour force through increased expenditures in the education sector. Similarly, technological innovation can be treated as an important factor to raise the productivity of physical capital. Thus, rapid growth can occur in countries that are investing heavily in education and research sectors. The study has applied quantitative research methodologies on panel data;including panel cointegration tests and FMOLS method. The results reveal that a long-run relationship exists among education, technology and economic growth. The study also supports the idea of "convergence" or "catch-up effect" among the developing nations. In addition, the empirical findings also support the fact that China and India are the emerging economies that are expected to catch up the developed nations at a faster pace as compared to other developing nations. Lastly, the short-run analysis is undertaken, which suggest that developing nations are showing temporary divergence in the short-run.