The Impact of Education Quality on Economic Growth: APanel Cointegration and Causality Analysis

The study investigates the dynamic relationship between education quality and economic growth in developed and developing countries for the period 2000–2020. Considering the Group Mean Fully Modified OLS (GM-FMOLS) model, the results prove the existence of long-run equilibrium relationships among observed variables and that education quality has a strong and significant positive impact on economic growth. A Panel Vector Error Correction Model (PVECM) has been adopted to show the long-run and short-run causality among the variables across the countries. The PVECM result reveals the presence of long-run and short-run bidirectional causality between education quality and economic growth.