Higher Education From The Perspective Of Human Capital Investment And Economic Growth

Since the reform and opening up, although China's average annual GDP growth has been nearly double-digit, the growth has over depended on the physical capital investment, while investment in education or human capital investment has been relatively little. What is the source of China's economic growth? Has China's economic growth mode been in transformation? For Chinese families, on the one hand, parents are hungry seeking for their children'higher education opportunities; on the one hand, a large number of university graduates face severe employment pressure. How to interpret this dilemma based on the human capital theory? Therefore, the purpose of this dissertation is in an attempt to explore the transmission mechanism of higher education to promote human capital accumulation and economic growth and social development.Based on human capital theory and New Economic Growth theory, using qualitative and quantitative method, this dissertation analyzes the contribution of higher human capital to three decades of economic growth and the effects of individual higher education return rate on human capital investment.This dissertation first reviews the relevant theories; and then from an empirical perspective, analyzes the contribution of higher education development, human capital accumulation to the United States and India's economic growth. Secondly, this dissertation studies the contribution of different levels of the labor force's education to China's economic growth and the concrete contribution of different periods'human capital accumulation to China's economic growth with the theoretical tools of econometrics. It takes a sample of Xi'an, calculates the changes of the return rate of higher education, and explains the reasons why Chinese families pay special attention to children's access to higher education from the microscopic view. Finally, this dissertation analyzes the problems of China's human capital accumulation and puts forward policy recommendations from the perspective of higher education.International experience has shown that the formation of human capital accumulation through higher education is an important source of economic growth. Higher education contributes evidently on the large number of innovative talents and the economic strength in the United States. The rapid growth of professional disciplines of higher education boosts the development of information industry in India.This dissertation establishes the education production function model and the human capital production function model, and tests its significance. Results of econometrics show that at the beginning of reform and opening up, human capital contribution to China's economic growth is low, while the contribution of physical capital investment is relatively large. After entering the new century, the contribution of human capital is gradually significantly, reflecting China's economic growth mode has been changing from labor intensive and physical capital investment to knowledge intensive and human capital investment.Return rate of education is an important indicator to evaluate the educational productivity. It is also a reference for people's decision-making to invest in education. Therefore, the change of individual higher education return rate has a major impact on higher education development and human capital investment.results of econometrics show that the return rate of higher education is greater than that of medium and primary education, which is particularly evident at the beginning of the opening up. This would have a long-term impact on the family education investment, and it also shows that the screening theory of diploma in China will still have a great market in the future. It explains why Chinese people have has enthusiasm for letting their kids receive higher education with the increase of the family's educational expenditure. It also predicts college students'employment pressure will still exist for a period. However, the return rate of higher education will show the law of diminishing returns, so an individual or family's investment in higher education will be more rational and the number of higher education students will be affected by this reduction in the total, the students select the type and level of education more diversely. This will have a greater impact on the future accumulation of human capital through higher education.China's higher education development and human capital accumulation does not yet meet the requirements of scientific development. Accelerating the development of higher education, achieving the transformation of higher education from quantitative expansion to quality improvement, increasing human capital investment and training creative talent is the inevitable choice to transform the economic growth pattern in China.