An Analysis of the Effect of Human Capital Investment on Economic Development in Nigeria: Does a New Indicator Alter Existing Evidence?

Abstract

This study adopted a broader perspective of economic development using access to clean, affordable and reliable energy services over GDP per capita, which was used in existing studies. To investigate whether the new measure altars existing evidence, the study employed the Johansen cointegration technique. The model follows the specification of the AK model and augmented Rostow’s stages of growth to account for the adoption of development indicators. The empirical result using energy access as a measure of economic development differs significantly and seems to portray the realities in the Nigerian economy. Compared with earlier studies, this reassessment shows that indicators of human capital investment do not significantly impact economic development in Nigeria. It is clear that the growth experienced in recent decades occurred independent of human capital capability of the economy, in fact, recent statistics from the Global Competitiveness Index 2018 show that in terms of competitiveness in education quality and on-the-job training, the Sub-Saharan Africa (SSA) regions underperformed when compared with other regions of the world.