Human Capital Development and Economic Growth Nexus in Nigeria

Abstract

Human capital development has long been touted as very critical imperative for growth in most developed and emerging economies across continents. However, Nigeria has remained a paradox in explaining the said growth induced hypotheses because of rising economic hardship amidst its levels of human capital development. Consequently, this study therefore examined human capital development as a catalyst for economic growth in Nigeria using a time series secondary data sourced from Central Bank of Nigeria (CBN) Statistical Bulletin of various issues. The method of analysis adopted for the study was Auto-regression Distributed Lag (ARDL) Model. From the result of the ARDL, it is observed that human capital development, per capital income and money supply has a positive and statistical significant impact on economic growth in the short run and long run in Nigeria while population growth showed a positive but insignificant impact on economic growth in the short run and the long run in Nigeria. The study therefore concluded that human capital development is one of the greatest catalysts of the improvement of the standard of living of the population which positively and significantly impact on economic growth in the short and long run in Nigeria. Based on the findings of this study, the study recommends that to enhance human capital development, the government should launch a sustainable skill development and apprenticeship programme. This will help improve knowledge, skills and capabilities that will be acquired through education and training. To enhance labour force productivity, the government should increase labor productivity of workers by direct investing in or creating incentives for increases in technology and human or physical capital. The government should introduce supervise credit scheme that will provide the needed funding to SMEs. This will help reduce poverty and unemployment and also enhance money supply to the economy. The government should put fiscal and monetary policies that will product domestic industries that will provide employmeny for the teaming population.