DRIVERS OF HUMAN CAPITAL DEVELOPMENT: EVIDENCES FROM NIGERIA
Human capital is globally recognized as an engine and foundation for long term economic growth and this explains why governments across the globe (Nigeria inclusive) make concerted efforts towards achieving meaningful human capital development. Despite massive expenditures on health and education, Nigeria still grades amongst the poorest and most miserable in the world in terms of human development index. Our study investigates the determinants of human capital development in Nigeria over the period 1985 to 2017. Hinged on the human capital theory as well as Sen’s capabilities approach, we developed a human capital model and employed the techniques of cointegration within the framework of autoregressive distributed lag model on Nigeria’s time series. Our findings show that whereas expenditures on health and education, growth in per capita income, and employment rate are significant drivers of human capital development in Nigeria, inflationary tendencies (captured by the consumer price index) significantly deters human capital development. Furthermore, infrastructural development positively impacts on human capital development but these impacts do not significantly drive human capital development in Nigeria. In addition to recommending government policies towards inflation control, we advocate for government prioritization of infrastructural development so as to boost the economic and social welfare of Nigerians as well as the dividends of democracy.
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