The impact of education policy on human capital development; a case of Nigeria

Abstract

One dividing line that has edged the developed countries above the developing countries is the calibre of human capital stock developed for national productivity. This study examines the impact of education policy on human capital development in Nigeria. Government expenditure on education (GEE) and Tertiary Education Trust Fund (TETF) were used to measure education policy in Nigeria, while Human Development Index (HDI) was used to measure Human Capital Development. Secondary time series data on the employed variables sourced from the Central Bank of Nigeria Statistical Bulletin, World Bank Data bank, and Federal Inland Revenue Service annual reports for 2011 to 2021 were employed in the study. With the aid of an Econometric View, descriptive statistics, stationarity test, and Autoregressive Distributed Lag (ARDL) techniques were used as data analysis methods. The findings reveal that GEE and TETF positively impact HDI, although the influence is not statistically significant. This implies that an increase in GEE and TETF promotes the stock of human capital in Nigeria, although at a nominal rate. The study concludes that education policy enhances human capital development positively. Therefore, for a significant impact of education policy on human capital development, the study recommends, among others, that education policy actors at various strata should increase the quantum of funds allocated to tertiary education. The government should also be committed to improving the quality of education by providing adequate financial resources to educational institutions and encouraging research and development.