Quality of Education, Economic Performance and Institutional Environment

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Abstract

This paper addresses two questions. First, how does the quality, rather than the quantity, of education impact economic performance? Second, does the quality of education have a larger impact on economic performance in countries with better institutions (i.e., social and political variables which affect economic outcomes)? Using data from more than fifty countries, we observe that there is a positive relationship between the quality of education and GDP per capita. In addition, we find that the quality of education has a more beneficial effect on GDP per capita in countries with better law and order conditions, government stability, and overall institutional environment. These results remain unchanged under various scenarios.

Keywords

Quality of education Quantity of education Human capital Institutions 

JEL

O10 O43 
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Notes

Acknowledgement

We would like acknowledge the support of the 2009–2010 Advisory Board Research Scholarship from Xavier University. We would also like to thank an anonymous referee and the editor for their helpful suggestions and comments. We are responsible for any remaining errors.

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Copyright information

© International Atlantic Economic Society 2011

Authors and Affiliations

  1. 1.Department of EconomicsXavier UniversityCincinnatiUSA

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