An Empirical Study On Shandong Province’s Higher Education Expenditure And Economic Growth

Higher education stands on a significant position in formation of human capital, andhuman capital plays an important role in the growth of modern economy. Based on theCobb–Douglas production function, this paper systematically analyzes the relationbetween Shandong province’s higher education fiscal expenditure and economic growth,pointing out the contribution of Shandong province’s higher education fiscal expenditure toeconomic growth is smaller than the contribution of labor and capital. This articleelaborately studies the theoretical relationship, aggregate impact and structure mechanismof Shandong province’s higher education fiscal expenditure and economic growth,believing that there is a prominent correlation between Shandong province’s highereducation fiscal expenditure and economic growth, and Shandong province’s highereducation fiscal expenditure, to some extent, accelerate the growth of economy, but not asmuch as labor and capital. In addition, the thesis applies gray relational analysis method toanalyze the relation between the higher education fiscal expenditure in Shandong provinceand industrial structure, concluding that Shandong province’s higher education fiscalexpenditure contributes mainly in tertiary industry comparing with primary industry andsecondary industry, arousing inspiration in industry structure optimization and upgrade.Through the analysis, it is indispensable to increase Shandong province’s higher educationfiscal expenditure, optimizing fiscal expenditure system, promoting the relation betweenhigher education outcome and advanced industry, making it the fundamental force to boosteconomy growth and industry structure adjustment.