Relationship between Education and Economic Growth: A Case Study of Nigeria

The discovery of oil has led many economies to rely heavily on the oil sector and neglect other sectors of the economy. Education is widely accepted to be among the leading instruments for stimulating economic growth, it plays a vital role in developing human capabilities. The main objective of this research is to investigate the relationship between education and economic growth in Nigeria using annual time series data from 1980-2015. This study uses an econometric model to examine the contributions of primary education, secondary education and tertiary education (proxied by school enrolments at various levels) and the government expenditure on education to economic growth of Nigeria (proxied by GDP per capita). This research paper employs a Johansen cointegration technique and the Vector Error Correction method (VECM) is employed test for long-run relationship among our variables of interest and the speed of adjustment among our variables is found to be 27.7% while the block exogeneity test is employed to test for causality. Keywords: Education, Economic growth, VECM, GDP per capita, Block exogeneity