We intend to conduct a study to find impacts of five independent variables (aggregate monetary supply, govt spending on public health, govt spending on social development, govt spending on higher education, and govt spending on social affairs and vocational training) on economic growth considered in GDP growth. Which model do you suggest?
ISSUE
The issue is about factors that contribute to the development of human capital.
HUMAN CAPITAL
Human capital is the stock of competencies or knowledge, habits or social attributes that indicates ability to perform labor or task in order to produce economic value. The elements of human capital include (i) knowledge, (ii) collaboration, (iii) work process, and (iv) productivity. Generally, factors that are said to be relevant independent variable (X: x1, x2, …, xn) include (a) education, (b) economic development, (c) productivity, and (c) innovation.
HUMAN DEVELOPMENT INDEX
The proposed factors: public health, planning, education and social policy are factors used for Human Development Index (HDI), not for human capital. These independent variables (x-variable) are used to measure social impact on social & economic policies. Human capital, on the other hand, looks at the accumulation of knowledge and competency level within an organization. Although this term “organization,” arguably could be extended to mean “country,” researchers are reluctant to do that because human capital is generally viewed as micro-macro factor and HDI is responsible for answering macro-factor analysis.
REGRESSION MODELING
Human capital development is a cumulative effect of long-term socio-economic policy. Therefore, time series data over a period of 10-20 years may be used. This secondary data may be obtained through the IMF’s website. There is the latest edition of the IMF’s annual publication: World economic Outlook 2013. Download here: http://www.imf.org/external/pubs/ft/weo/2013/02/
Time series regression may be explored for the development or trend of (a) education, (b) economic development, (c) productivity, and (c) innovation.
EXPERIMENTAL DESIGN
It might be worth while to look at cross industry, and organizations over a period of time: 5, 10, 15, 20 years. Comparison study across within country and country-by-country within the same or similar economic development stage may be used.
ISSUE
The issue is about factors that contribute to the development of human capital.
HUMAN CAPITAL
Human capital is the stock of competencies or knowledge, habits or social attributes that indicates ability to perform labor or task in order to produce economic value. The elements of human capital include (i) knowledge, (ii) collaboration, (iii) work process, and (iv) productivity. Generally, factors that are said to be relevant independent variable (X: x1, x2, …, xn) include (a) education, (b) economic development, (c) productivity, and (c) innovation.
HUMAN DEVELOPMENT INDEX
The proposed factors: public health, planning, education and social policy are factors used for Human Development Index (HDI), not for human capital. These independent variables (x-variable) are used to measure social impact on social & economic policies. Human capital, on the other hand, looks at the accumulation of knowledge and competency level within an organization. Although this term “organization,” arguably could be extended to mean “country,” researchers are reluctant to do that because human capital is generally viewed as micro-macro factor and HDI is responsible for answering macro-factor analysis.
REGRESSION MODELING
Human capital development is a cumulative effect of long-term socio-economic policy. Therefore, time series data over a period of 10-20 years may be used. This secondary data may be obtained through the IMF’s website. There is the latest edition of the IMF’s annual publication: World economic Outlook 2013. Download here: http://www.imf.org/external/pubs/ft/weo/2013/02/
Time series regression may be explored for the development or trend of (a) education, (b) economic development, (c) productivity, and (c) innovation.
EXPERIMENTAL DESIGN
It might be worth while to look at cross industry, and organizations over a period of time: 5, 10, 15, 20 years. Comparison study across within country and country-by-country within the same or similar economic development stage may be used.
I agree with the suggestions of Balazs and Paul l. The Multiple Co-efficient of Correlation Method is a appropriate to study the mutual impact relation between economic growth and HCD.
I think TOBIT model may be appropriate. If you normalise the parameter, they will lie within 0 to 1. Then censored regression model like Tobit may work better. After that you can compare the coefficients of Multiple Regression and Tobit model
Many thanks to all for contributing your ideas and suggestions that have surely helped us here to better shape the research.
I agree with Paul and Balazs. I need to point out that multiple regression simply means having multiple explanatory variables as opposed to simple regression. Therefore even the Tobit model can be estimated using multiple regressors. You do not have to use a Tobit for your study. However, you have to find out if GDP or per capita GDP also influences human capital (whichever proxy you decide to use for human capital). If so then you may want to use a more advanced model to cater for this two way causation effect. The same goes for the other X's. First read the literature related to this study of yours (both theoretical and empirical works) before embarking on the modelling. This will guide you on the direction you should be taking in terms of the modelling.
- Badges
- Science topic
- Similar topics
- Mathematics
- Statistics
- Regression