ERROR CORRECTION MODEL OF IMPACT OF EDUCATION ON ECONOMIC GROWTH IN NIGERIA (1980-2014)

Investment in Education is one of the surest ways of achieving human capital formation. Human capital formation involves investment in education, training, health and other social services that enhance the productivity capacity of labour. This study examines impact of education on the economic growth in Nigeria from 1980-2014 using error correction model (ECM). Unit root and cointegration tests were carried out on the variables used in the study. Findings show that all the independent variables; capital and recurrent expenditures on education, physical capital (gross fixed capital formation) and labour force have both positive and significant impact on economic growth. Also, previous growth has a positive and significant impact on current growth. The study recommends among others; more expenditure in terms of capital and recurrent expenditures on educational sector as well as proper monitoring and evaluation of the funds allocated to both capital and recurrent expenditures on education so as to achieve the objectives for which such funds are designed for.