Atlantic Review of Economics (Jul 2016)
Higher education, Graduate unemployment, Poverty and Economic growth in Tunisia, 1990-2013
Abstract
This paper examines the relationship between economic growth, higher education, unemployment and poverty using properties of time series variables while applying the Ordinary Least Squares (OLS) method. Our study thus contributes to the existing literature by giving the first integrated approach to examine the four way linkages in the Tunisian background over the period 1990-2013. This paper holds that higher education can impact unemployment and graduate unemployment causes poverty which would affect economic growth. Our empirical results show that there is bi-directional causal relationship between per capita gross domestic product (GDP) and poverty rate (POV) and also between Number of graduate students (GRA) and School enrollment tertiary education (ENR) besides unidirectional causal relationship which running from Number of graduate students to Unemployment with tertiary education (UNP), from Higher education expenditure (EXP) to poverty rate and from Unemployment with tertiary education to poverty rate. Our empirical results also verified the existence of positive effect of ENR, GRA and POV on economic growth, while, UNP and EXP have negative determining influence on economic growth with only GRA statistically significant. These empirical insights are of particular interest for the policy makers as they help build sound economic policies to sustain economic development and improve the higher educational quality.
