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bba economics
Relationship between Education and Economic Growth in Pakistan: A time series analysis.

Zaheer Khan Kakar, M.Phil Fellow, Department of Economics, National University of Modern Languages(NUML), Islamabad.

Dr Bashir Ahmad Khilji, Head Department of Economics, National University of Modern Languages (NUML), Islamabad.

Muhammad Jawad Khan, Lecturer, Department of Economics, Balochistan University of Information Technology, Engineering & Management Sciences (BUITEMS), Quetta.

Abstract
Education is one very important factor of human capital formation. The objective of this paper is to examine the long-run relation between education expenditures and economic growth in Pakistan. Time series data is used for the period 1980-2009 for analysis and co-integration and error correction models are used to determine the long and short run relationship of education and economic growth. In this study, an attempt is made to determine and analyse the educational trends policy, trends of education, and challenges and it role in economic development in Pakistan. The study also presents policy measures for education sector for human capital formation and escalates economic growth in Pakistan.

Keywords
Pakistan, human capital, education, Economic Growth. Time series, co-integration, error correction.

1. Introduction
Education is universally acknowledged a primary tool to promote economic development. It plays a fundamental part in developing human capital and escalates economic growth by improving skills, increasing competency, and productivity. The education brings benefits for the whole society and the individuals. For developing country like Pakistan, education plays a key role in poverty reduction, and removing both social and income inequalities.

This study focuses on the question that, "whether improvement in education sector brings improvement in economic growth in Pakistan. Generally, it can be said that education does effect the economic



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