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A Comparative Study of the Impacts of Human Capital and Physical Capital on Building Sustainable Economies at Different Stages of Economic Development

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  • Xiaohao Ding

    (Institute of Economics of Education, Peking University, Beijing 100871, China)

  • Yifan Huang

    (Center for Higher Education Development of Xiamen University, Institute of Education, Xiamen University, Xiamen 361005, China)

  • Wenjuan Gao

    (Institute of Higher Education, Beihang University, Beijing 100191, China)

  • Weifang Min

    (Institute of Economics of Education, Peking University, Beijing 100871, China)

Abstract

This study investigated the contributions of human capital and physical capital to economies at different stages by measuring the economic development with the traditional GDP and green GDP. The traditional GDP stood for the quantity of economic growth, and the green GDP, taking both the energy consumption and environmental pollution into account, was employed to represent the sustainability of economic development. We used a panel data of 143 countries and regions during the period from 1990 to 2014, and results showed that the elasticities of output with respect to human capital were greater compared to physical capital, while green GDP was significantly more sensitive to changes in human capital than the traditional GDP. In particular, considering the unbalanced distribution of economic growth among countries and regions, we employed the quantile regression model to explore the heterogeneous roles of physical and human capital in different stages of economic development, which evidenced not only the significance but also the stability of human capital. As national economic levels grew, countries became less dependent on physical capital, yet human capital maintained its outstanding role at different stages of economic development, particularly for the building of more sustainable economies.

Suggested Citation

  • Xiaohao Ding & Yifan Huang & Wenjuan Gao & Weifang Min, 2021. "A Comparative Study of the Impacts of Human Capital and Physical Capital on Building Sustainable Economies at Different Stages of Economic Development," Energies, MDPI, vol. 14(19), pages 1-14, October.
    • Handle: RePEc:gam:jeners:v:14:y:2021:i:19:p:6259-:d:648317
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