gender differential paper IJCRB

ijcrb.webs.com
INTERDISCIPLINARY JOURNAL OF CONTEMPORARY RESEARCH IN BUSINESS
JUNE 2011
VOL 3, NO 2
power. It means that educated and specialized people participate in national production in a higher proportion at
equal conditions (Emadzade, 2004).
Impact of educational and health investments in Schultz view is so important that could transforms usual standards
of savings measurement and the existent investments fundamentally and changes structure of wages and salaries and
amount of obtained incomes from work to the proportion of incomes obtained from properties and assets (Karnoy,
Aminfar, 2002).
Health besides education is considered as one of the most important aspects of the human capital. Hanushek and
Dongwook (1995) and Schultz (1999) suggest that health improves an individual’s mental and intellectual
capabilities, leading to better educational outcomes. Given that long-term growth is fueled by technical progress—
itself the product of increased health, education, and training—increased health can raise the growth rate of income
through technical innovation. Schultz (1999) has argued, health is the ultimate indicator of the well being of a
nation, hence the attainment of high stocks of health is an important aspect of development in its own right(Gyimah-
Brempong, 2004).
Health can affect production level of a country through various channels. The first channel that its impact has been
pointed out in most studies is better efficiency of healthy workers in comparison with others. Healthy workers work
better and more than others and have a creative and more prepared mind. Along this direct impact it has indirect
impacts on production too. For instance, improvement of health in human force will have the motivation to continue
education and gaining of better skills, since improving of health conditions will increase attractiveness of investment
in education and educational opportunities from one side and it will prepare individuals more to continue education
and gain more skills by increasing of learning capability on the other side. Also enhancement of health is leaded to
decreasing of mortality and increasing of life expectancy and this will encourage individuals to save more.
Following increasing of saving in the society physical capital will be enhanced and this issue will affect labor force
productivity and economic growth indirectly (Weil, 2006).
3. Research Background
We can find out importance of human capital by referring to performed historical studies about impacts of human
capital on economic growth. Numerous studies in the economic growth literature argue that human capital has a
positive effect on economic growth (Barro, 1991, 1996; Mankiw et al, 1992; Levine & Renelt, 1992; Benhabib &
Speigel, 1994; Caselli, Esquivel,&Lefort, 1996; Barro & Lee, 1996; Sachs &Warner, 1997).
Barro and Sala-I-Martin (1995) fitted economic growth rate on indexes such as having access to gross domestic
product in a sectional-time study and based on data of a group of countries in years 1965-1985. According to
obtained results, education attainment that is measured with average amounts of education years has a positive and
significant relation with growth. On the other hand, educational expenditures of the government have a positive and
significant impact on growth. Knowels and Owen (1997) have studied the impact of health and education on
economic growth too by means of health care expenditures index. They conclude that there is a strong relation
between income and health and also between income and education. Rivera and Currais (1999) found out positive
conclusions with regard to impact of human capital on economic growth in two researches that had done about the
COPY RIGHT © 2011 Institute of Interdisciplinary Business Research 174