Human capital and innovation: evidence from panel cointegration tests

Abstract

Panel cointegration techniques applied to pooled data for 27 countries for the period 1960 to 2000 indicate that (1) government spending in education and innovation indicators is cointegrated; (2) education hierarchy is relevant when explaining innovation; and (3) relationship between education and innovation can be obtained after an accommodation of a level structural break.

Keywords:

• human capital
• innovation
• panel cointegration

JEL Classification:

• O31
• O50

Notes

¹The countries are Australia, Austria, Belgium, Brazil, Canada, China, Denmark, England, Finland, France, Holland, Hong Kong, India, Ireland, Israel, Italy, Japan, Malaysia, Mexico, Norway, New Zealand, Russia, South Africa, Spain, Switzerland, Sweden and the United States.