Investing in human capital and economic growth in Libya

Abstract

The goal of this research is to measure the impact of investment in human capital on economic growth in Libya, based on the theoretical framework of the Cob-Douglas production function. To do this, the autoregression model for distributed lag periods in both its linear and non-linear forms was employed. This aims to investigate the extent to which nonlinear models are able to Achieving better results in this field. The research found that there is a long-term equilibrium relationship between the independent variables and the dependent variable representing economic growth The standard results obtained from the non-linear model were superior, which indicated that the education spending variable used as an indicator of investment in human capital is inversely related to the dependent variable representing economic growth. The research recommends working to increase the contribution of the educated workforce in the labor market, working to align education policies with employment policies, working to strengthen the principles of governance and raising the quality of institutions.