Causality relationship between human capital, technological development and economic growth

Abstract

In this research, human capital, technical advancement, and economic growth in Indonesia are examined using vector analysis. In analyzing causality, we use a research period of more than 20 years using secondary data from the world bank. Our findings show that technology development and Human Resources are two important components in economic development. Human resources are an important factor of the industry and the quality of human resources is determined by the human capital owned by these human resources. Technology aids people in their job, allowing them to execute at a higher level of efficiency and quality. Investment in technological development and human capital may increase the speed and quality of human beings, which can lead to increased economic growth and productivity. A strong economy is essential to the long-term viability of human capital and technology investment. Human capital and technology are mutually reinforcing each other in the development of Indonesia as a result of economic progress. The three variables are in a mutually reinforcing relationship so that the three variables are closely related and mutually reinforcing.