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Economic Growth and Human Development

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  • Alejandro Ramirez
  • Gustav Ranis

    (Economic Growth Center, Yale University)

Abstract

This paper explores the links between economic growth and human development, identifying two chains, one from economic growth to human development, the other, from human development to economic growth. The importance of various links in each chain are explored empirically with the help of cross-country statistics for the period 1970-92. Public expenditures on health and education, notably female, represent especially important links determining the strength of the relationship between economic growth and human development. The investment rate and income distribution are significant links determining the strength of the relationship running from development to economic growth. These two-way chains can generate self-reinforcing, virtuous or vicious cycles of development, as well as identifying lop-sided performers. Over time we find that lop-sided development seldom persists: countries initially in favor of economic growth lapse into the vicious category, while countries favoring human development advance into the virtuous category. This finding implies that, although both human development and economic growth should be jointly promoted, human development should be given sequential priority.

Suggested Citation

  • Alejandro Ramirez & Gustav Ranis, 1997. "Economic Growth and Human Development," Working Papers 787, Economic Growth Center, Yale University.
    • Handle: RePEc:egc:wpaper:787
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    7. Hina Amir & Muhammad Khan & Kanwal Bilal, 2014. "Role of Educated Labor Force in Economic Growth of Pakistan: A Human Capital Respective," International Journal of Empirical Finance, Research Academy of Social Sciences, vol. 3(4), pages 212-224.
    8. Sacchidananda Mukherjee & Debashis Chakraborty, 2007. "Environment, Human Development and Economic Growth after Liberalisation: An Analysis of Indian States," Working Papers 2007-016, Madras School of Economics,Chennai,India.
    9. Pawel Maciaszczyk & Mykhailo Dyba & Iuliia Gernego, 2019. "Strategies of Human Development in the Context of Global Digital Change," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 5, pages 10-24.
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    11. Guisan, M.Carmen & Aguayo, Eva, 2003. "Education, Industry, Trade and Development of European and Eurasian Countries in 1980-99," Applied Econometrics and International Development, Euro-American Association of Economic Development, vol. 3(1), pages 115-141.
    12. Howard White, 1999. "Global poverty reduction: are we heading in the right direction?," Journal of International Development, John Wiley & Sons, Ltd., vol. 11(4), pages 503-519.
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    14. Yahya Z. ALSHEHHI, 2017. "Achievements In Terms Of Human Development Dimensions," SEA - Practical Application of Science, Romanian Foundation for Business Intelligence, Editorial Department, issue 13, pages 109-125, May.
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    More about this item

    Keywords

    Human Development; Economic Growth; Cross-country Statistics 70-92; Resource Allocation; Income Distribution; Poverty; Productivity; Health; Technology; Education;
    All these keywords.

    JEL classification:

    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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