IMPACT OF HUMAN CAPITAL ON ECONOMIC GROWTH IN ASIAN COUNTRIES

Human capital is a critical factor of economic growth and economic development. In the last few decades, scholars, economists, and policymakers have paid close attention to the significance of human capital as they have attempted to understand the complex relationship between a country's economic growth, and quantity and quality of its labor force. Therefore, all countries are building up their economy with their spending so that they can achieve sustainable and equitable economic growth. This study aimed to investigate the impact of government spending on education and health, life expectancy at birth and secondary school enrollment on the economic growth of 48 Asian countries from 2014 to 2021. From the diagnostic test and Hausman test, the study found fixed effect model as the best model to describe regression. Due to the problem of heteroskedasticity, a robust fixed effect model was employed. The results found that gross fixed capital formation, government expenditure on health, life expectancy at birth, secondary school enrollment have positively and significantly influence economic growth, whereas government expenditure on education and population growth have negatively and significantly influence economic growth in Asian countries. Most of these countries are facing several economic, political, and social issues and among all they are facing a vicious circle of poverty. The rapid rise of the population may put strain on limited resources, while deficiencies in the distribution of funds for education could hinder economic advancement. Therefore, authorities should consider implementing population management measures and optimizing education expenditures to align with economic goals. Overall, the study provides a comprehensive and inclusive framework for understanding and fostering economic growth in Asian countries.