Human Resource Development and Economic Growth in Bangladesh: An Econometric Analysis

Abstract

This study empirically verifies the contributions of human resource development (HRD) efforts in the growth process of Bangladesh. In order to conduct the empirical analysis, a hypothetical growth model is constructed in light of two prominent endogenous growth models, ie, Lucas (1988) and Romer (1986, 1990), and a couple of econometric tests, ie, Augmented Dickey-Fuller (ADF) unit root test and Engle-Granger cointegration are done. In this research, the Engle-Granger cointegration tests have suggested a positive correlation between HRD activities and economic growth process of Bangladesh. Among the HRD activities, investments in education have played a stimulating role and R&D expenditures have made a weak but positive contribution in growth. Besides HRD, there is also evidence that ‘exports’ have played an important role in Bangladesh’s growth.

Keywords: Growth theory, HR development, Bangladesh, Unit root test, Cointegration test