The impact of financial development on human capital in Iran

Subject Areas : Futurology

Bahram  Sahabi ¹ (ندارد)
Mohammad  Hasani ² (مسئول مکاتبات)
Amir  Mirzaei ³ (ندارد)

Received: 2011-07-08 Accepted : 2011-10-19 Published : 2011-10-23

Keywords: Financial Development, Economic growth, Human Capital, VECM,

Abstract :

This paper investigates the impact of financial development and economic growth on humancapital in Iran for the period of 1357-1387. This paper uses the vector error correction modeland Johansen cointegration test for explaining the relationship between these variables. We alsouse three measures for financial development such as: the liquid liabilities as percentage ofGDP, the domestic credit to private sector as percentage of GDP, and the amount of capital asshare of GDP proxied by stock market development.The results suggest evidence of positive relationship between economic growth and humancapital. In financial development indices, we found that the liquid liabilities index and StockMarket Development index have a positive relationship with human capital. But we found noevidence between the domestic credit to private sector and human capital