Munich Personal RePEc Archive

The Contribution of Education to

Economic Development

Alali, Walid Y.

University of Oxford – Economic Department

1 September 2011

Online at https://mpra.ub.uni-muenchen.de/115614/
MPRA Paper No. 115614, posted 11 Dec 2022 17:46 UTC
 The Contribution of Education to Economic Development

Walid Y. Alali

University of Oxford – Economic Department, Manor Road Building, OX1 3UQ

Oxford, United Kingdom

September 2011
September

Education is a comprehensive term for academic studies and developing talents and skills. It's an
essential factor in Human capital development. Human capital investment is a fundamental issue for
countries to sustainable economic development achievement; furthermore, it sang the community
members to grasp themselves and the surrounding circumstances and the impact of the global variants.
Education improves the quality of living, benefits society; productivity and innovation; subsequently
promotes entrepreneurship. Education helps the poor and improves their food intake by increasing
families' incomes and spending on health and food, to raise their standard of living and make them better
healthier choices.

Key Words: Economic Development, Growth, Human Capital, Labour Productivity; Poverty, Health,
Human Development

1. Introduction
This paper presents a theoretical perspective on how education represents a foundation for
economic development and the impact on poverty, labour productivity, health, innovation and
technology, and the equality benefits of incomes. Education is the key to the well-being of
society and consistency also increases the efficiency of the economy. Subsequently, raise
human capital efficiency and value, which means raising the community productivity and
intellectual resilience this will help low-income families from poverty and increase the labour
force. To build distinct societies and countries that can compete in global markets, they must
focus on building children, their integration into society, and coexistence with each other
without racial, ethnic and social discrimination. This is the role of education to build societies
and innovation and tolerance among society members. The big problem of china and India as
the biggest developing countries is to compresence and improve their education sector, taking
into account the limited resources.

Understanding and helping alleviate poverty is the real and main economic purpose. There is a
relation between human capital investments and poverty alleviation. The human capital term

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may not be usual to everyone. Human capital means the education, skills, training and health
of individuals in society. It is capital as education or skills are long-lasting and an integral part
of society, like a machine in a factory lasts. Prior to the 19th century, investment in human
capital was not important. The investment was quite small in schooling, training, jobs and other
forms. Radically changed during the century with the scientific development of new goods and
more efficient methods of factory production and the first country started was Great Britain,
and gradually spreading to other countries. In this century, skills, education, and other
knowledge have been crucial determinants of individuals and a nation’s productivity, until the
last century became the Age of Human Capital, which means the standard of living is measured
by success in developing Knowledge, skills, health and habits of its population.

It reached that education of human capital, training, health and other comprises around 80% of
the wealth in the US and other developed countries. Even if these estimations are exaggerated,
it is not large, this indicates human capital can be neglected only at a country’s peril.

Now to investigate how human capital impacts economic development, we considered some
further actions, first by splitting the human capital of education levels into three, primary,
secondary and higher education, then use the expectation of life to measure health factors in the
human capital, because there are differences between countries such as level of development,
historical events and energy impact; therefore we set-up some variables virtual to cover it.

The significance of human capital for growth is clearly demonstrated by the outstanding records
of Taiwan, Japan, South Korea, Hong Kong, and other economies of fast-growing Asian
countries. Because they are real examples of being lacking in natural resources, they may be
overstated as a determinant of economic performance, even though their exports face
discrimination against their exports in the West. They have been able to grow very quickly
though in large portion because they have a well-trained workforce, well-educated and very
hard-working backgrounds, and dedicated parents.

For example, Korea, North Korea owns all the coal and before the War of Korea, the North was
richer than the South. Today, North Korea has an economic catastrophe, and the South is a rich,
prosperous and democratic country. The reason is that the South is able to harness the talents
of its inhabitants and enhance them. All Asian tigers are extremely educated and trained. On-
the-job training and so forth, in addition to good work job habits and values, support these hard-
working people.

2. Education Matter for Economic Development

Investment in human capital was not considered before two centuries even in developed
countries, there was little spending on employment training, education and R&D, while with

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time this is changed magnificently especially now. Last century especially in the second half,
knowledge, skills, education and all the human capital factors became very decisive and became
the era of the human capital age and the country's living standard has been measured by the
develop skills, knowledge, education, health and all other factors related to the human capital
development by relatively to the population.

These days extraordinary expansion in the education sector in many developing countries and
improvement in quality and offering of all levels of education, Rather, it extended to be more
inclusive of both genders as we find in developing countries such as the Middle East, more
demanding on high education level also, the girls and women have shared the same opportunity
today and this is a very effective investment for such countries, while this gives women a chance
to increase the family income and therefore better living standard, infant mortality have
decreased and improved educational attainment for generation, all that helping developing
countries to integrate into the global markets for trade, innovations, technologies and
manufactured goods, ability to compete in services and knowledge market globally, all that
achievement based on the human capital of education (as we mentioned earlier, the definition
of education). Making sure all society members are educated, with good health care and
prepared to face any problems with high-level skills much beyond the basic. Investing in
teachers and teacher programs also the development of the academic foundation and encourages
those with skills and preparing educational programs to develop their skills.

There is a series of studies will continue in this field. There is no economic development
constant achieved without human capital investment, certain matters need to be considered such
as inequality and non-distribution in education will affect negatively on country's income per
capita, and good distribution management for the human capital with appropriate methods,
securing suitable jobs with specifications consistent to asset allocation will affect positively on
GDP growth, in case of failed will insignificant impact negatively on the growth. Investment
in human capital has little impact on growth, except in the case of being able to use education
competitively in open markets, as a direct relationship, the bigger the market, the greater to use
of skills and education. Education has been considered in the human capital investment
revolution 2, which led others to publish a series of growth studies which contribute to education
in economic growth 3; also a study covering around 29 developing countries which showed the
education contribution to growth by a percentage which is different for a country to other 4.

2 human investment revolution in economic thought” (Bowman, 1960)

3 The seminal works of (Schultz, 1961) and (Denison,1962: 67)
4 (Psacharopoulos, 1984)

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Productivity

Knowledge is the fact that differences humans from other creatures and this is what makes
human capital the species and led to affect economic development, while knowledge is the
major factor in this issue. Knowledge is always transmitted without an extensive and formal
school system. Back old days Socrates privately taught Plato; Plato did the same to Aristotle
and so on; apprentices always were taught and guided skills by masters; parents taught their
children. Schools train young children, while the system reaches large numbers of people.

Educational provisions in any country represent the main determinants of growth in countries'
exports and output constituted an important factor in a system’s capacity to borrow technology
from others effectively. education (primary and secondary), nutrition and health raise workers'
productivity in urban, rural, and vocational, facilitating the acquisition of managerial capacity
and skills; tertiary education is supporting of basic sciences development, appropriate selection
of development of technologies and local adaptation and technology imports; Secondary and
higher education are also critical components of the development of key institutions, of
government, the financial system and the law, among others, all are essential to the economic
growth.

We will discuss the impact of education on other sectors briefly. Agriculture productivity is
impacted by education but not much, as the farmers do not have the knowledge to use modern
technologies, regarding fertilizers, new irrigation systems, the new technologies of an implant
between different products and also the technologies to increase the productivity of other things.
Regarding the macro and micro levels, many empirical studies clarify this relationship, several
of them approved that earning was raised with extra education years 5, where primary school
have more effect on return than secondary school. Innovation and technology rely on education;
meanwhile, significantly impacting the industrial sector positively, incontestable, increases
entrepreneurs' skills, thus achieving productivity easement 6. As for the macro level, there are
some researchers on this topic who incarnate technical progression by incorporating some of
the same effects, labours with higher education are more productive than others as they have
more ability for innovation and creativity 7, thus it becomes Education increases productivity
and quality, and it's self-evident increase average export which crucial factor of GDP, therefore
education affect the growth rate 8. And so on we proved education influences the skills and
creativity of the labours which means human development which results in an effect on macro
performance. Education and skills of the labour force in developing countries influence its
trade. We should consider not only education can transform economic performance but must
be accompanied by skills, human development level investment quantity, and the country's
5 (Behrman 1990, Psacharopoulos 1994). & (Psacharopoulos, 1994: 1325-45)
6 (Deraniyagala, 1995).
7 (Lucas, 1998)
8 (Perotti, 1993)

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policies. Education also presents a major role in policymakers' and leaders' decisions. A big
volume of investment for foreign and domestic when it comes to human capital availability.

Family and the Education Human Capital

To build a high-quality human capital must start building the members, the core of the society,
which means families. The literature has documented a strong association between parental
education of the family and child human capital development, a relationship that persists despite
the inclusion of controls for household and community background factors. This relationship is
often attributed to higher levels of investment in children’s human capital made by more
educated parents, but the nature of such investments has not been well understood. Investments
in human capital may include spending on educational goods and services and time spent
interacting with children for educational purposes, yet parents in resource-constrained
households in areas with incomplete credit markets are likely to face a trade-off between these
investments. Because more educated parents are likely to earn higher wages, the opportunity
cost of time spent outside the workplace is high, and these parents may spend less time
interacting with children in order to provide more goods for children’s human capital
development. However, more educated parents are likely to be more adept at teaching children
in the home; thus they may forgo sometime in the workplace in order to provide more time to
interact with children. Finally, more educated parents may provide higher levels of both
investments despite being resource-constrained if the returns to children’s human capital
development differ for their children or if such parents have different preferences for children’s
education.

Families always make an assortment of decisions. We find that more educated parents are not
substituting goods investments for time investments or vice versa but are, instead, providing
higher levels of both types of investments. This is generally robust to conditioning on a rich set
of controls, including household wealth, teacher quality, child cognitive development, and
community fixed effects, suggesting that the relationship between parental education and
educational investments is quite strong. The perceived returns to education are higher for the
children of more educated mothers. In addition, more educated mothers prefer more education
for their children. Greater investment in both goods and time among more educated parents is
thus likely explained by both higher expected returns and different preferences for education.
The trend becomes as long as countries develop, more to do for children and each developed
nation tries to do so, we see in some developing countries achieve remarkable development
such as rate of birth as some developing countries like far-east and Latin America have a lower
rate than the USA 9. Same for some Middle East areas having a lower rate of birth than other
areas and this is because of the educated families in particularly educated mothers. We can say
9 (Becker, 1998) & (Baloglu, 1998: 40-42)

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in general, more educated families resulting better improvement in children's handling and also
decrease the gap between both sexes of children improvement. Many literature reviews find
that the marginal effect of education differs for mothers and fathers: an additional year of
mother’s education leads to greater time investments than an additional year of father’s
education. This finding is particularly true for sons who scored below average on a cognitive
development test and for daughters who scored above average. Mother’s education also has a
stronger impact on investments in some goods investments for low-scoring sons. The
pronounced difference in parental education does not have a strong, systematic gender bias in
investments; promoting education in time investments suggests that mothers either have a
greater interest in their children’s schooling or that they have a lower opportunity cost of time.

Many studies find that for poor families, education improves their lives not only for securing
food but will give them better choices for a healthy quality of life, as a result, lower mortality
and better health therefore they consider more investment in education and human capital when
they understand it's a benefit.

Openness and Trade

The impact of education on trade preferences has more to do with ideas and economic literacy
than it does with calculations about how trade affects personal income or job security, this is
not to say that the latter types of calculations are not important in shaping individuals’ views of
trade. We strongly suspect that concerns about the effects of trade on personal economic well-
being do play a large role in shaping trade policy preferences, but they are related much more
directly to the impact that trade openness is expected to have on particular industries and firms.
“Specific factors” models of the distributional effects of trade that, unlike the Stolper-
Samuelson theorem, allow that factors of production are not perfectly mobile between different
sectors in the economy, predict that the real incomes of individuals are tied closely to the
fortunes of the particular industries in which they are employed or invested 10.

Developed and some other developing countries have successfully taken advantage of the
openness and development in learning and education. Openness helps increase demand for
learning and education, while education with Knowledge helps strengthen the export
competitiveness of countries and trade performance accumulation 11.

After learning how trade policies would affect themselves, people became more likely to
advocate policies that would advance their material interests. On the other hand, distributional
information made people more sensitive to the interests of society. Information about the impact
10 See Jones 1971; and Mussa 1974+ The specific factors approach underpins much of the most recent analysis of the political
economy of trade in contemporary advanced economies: see Magee 1980; Grossman and Helpman 1994; and Hiscox 2002.
11 (Grossman and Helpman 1989)

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on other groups made people more likely to support policies that would help others, and less
likely to support policies that would hurt them. On balance, selfish responses outweighed
altruistic ones. Thus, if people knew more about the distributional effects of trade, the
correlation between personal interests and policy preferences would tighten. The people
respond to information about efficiency. Economists generally agree that protectionism
decreases aggregate welfare. Transmitting this knowledge to respondents weakened the
connection between material self-interest and trade preferences. At the same time, efficiency
cues substantially raised support for free trade. In fact, some studies showed that if the public
were fully informed—knowing not only about winners and losers but also about efficiency—a
majority of Americans would endorse free trade instead of supporting protection for low-skilled
and/or high-skilled workers. These findings have important implications for research on
international relations.

To date, studies of individual trade preferences have indicated only weak ~Mayda and Rodrik!
or no ~Scheve and Slaughter! The individuals employed in import-competing industries will be
much less likely to support trade openness than those employed in exporting industries. But
these studies have measured the industry-specific effects of trade in an indirect way, locating
respondents by industry using answers to a standard question about the type of business in
which they are employed, then controlling for the aggregate trade positions of those industries
~for example, their degrees of import penetration! when estimating individual trade
preferences11. There are at least two major problems with this approach,

First, accurately coding respondents by industry of employment using standard industrial

classifications is extremely difficult, as respondents typically give vague answers to questions
about the type of business in which they work12.

Second, aggregate industry measures of import penetration and export dependence may offer
more information about policy outcomes than policy preferences, and they obscure the obvious
variation in positions taken by firms in the subcategories within each broad industry grouping13.

Future studies should be substantially refined to better account for industry-specific effects if
we are to accurately gauge the impact of distributional concerns on attitudes toward trade and
globalisation14. Resolving these issues is crucial for improving our understanding of the

11 Scheve and Slaughter 2001a and 2001b examine industry effects using this approach and industry coding supplied in the
NES. Mayda and Rodrik 2005 were forced to take an extra step: because the ISSP data does not provide coding by industry,
they inferred industry of employment from occupational codes assigned to respondents instead.
12 When the staff at the Panel Study of Income Dynamics checked a random sample of surveys, for instance, they found that

industry codes differed across coders in 14 percent of cases.

13 The standard concern about using import penetration as a measure of an industry’s trade policy preference is that low levels

of penetration may reflect the effectiveness of a protectionist lobby ~not the absence of concerns about import competition!
14 One recent study, for instance, questioned respondents directly about the likely impact of trade on the security of their

particular job, asking them whether they felt that increasing trade made their job more secure, less secure, or had no clear
effect ~see Hiscox 2004! The estimated probability of support for trade was some 45 percent higher among respondents for
whom trade had raised job security compared with those reporting that trade made their job less secure

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determinants of anti-globalisation sentiments and the range of policies that might address them.

Income

While research over the past decade has made genuine progress on the question of the causal
effect of education, it may be useful to conclude with a brief list of related topics that have not
been as thoroughly addressed.

Education plays a central role in modern labour markets. Many studies from different countries
and different time periods have confirmed that better Learning and educated individuals earn
higher and better wages, also experience less unemployment, and work in more prestigious
positions and occupations than their less- learning and educated counterparts.~ Despite the
overwhelming evidence of a positive correlation between labour market status and education,
social scientists have been cautious to draw strong inferences about the causal effect of
schooling. Also, it is very difficult to know whether the higher earnings observed ~ by better-
educated workers are caused by their higher education, or whether individuals with greater
earning capacity have chosen to acquire more schooling.

Economists' interest in the same issue was stimulated in the fifties of the last century by growth
accounting exercises which found that increased education levels could explain much of post-
war US productivity growth, leaving little room for technological change15. Skeptics conclusion
was only valid if the observed cross-sectional earnings differences between education groups
reflected true productivity differentials, rather than inherent ability differences that happened
to be correlated with education16. The emergence of large-scale microeconomic datasets in the
sixties last century lead to an outpouring of research on education and earnings, much of it
focused on the issue of "ability bias" in the earnings differentials between more- and less-
educated workers.

Education can affect the growth of per capita income through its effect on the denominator, that
is, population growth. For example, there is a study conducted on a group of countries in Africa
in the mid-1980s, which demonstrated a negative association effect in about half of the
countries and no significant effects in the other half, while secondary education consistently
resulted in lower fertility 17. The three successful low-fertility countries, Kenya, Botswana and
Zimbabwe, had the highest levels of female education as well as the lowest infant mortality
rates 18.

15 (Becker, 1964; Griliches, 1970)

16 (e.g., Denison, 1964)
17 (Birdsall 1995, Behraman and Wolfe 1987)

18 (Ainsworth, 1995).

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Inequality

Qualification, training and education not only enhance efficiency and growth but also reduce
inequality in countries and impact disadvantaged backgrounds. Education is the basis and the
most effective method for young people from poor backgrounds to be able to move up and enter
the economic hierarchy since human capital is the main driver of 90% of the population. This
is one of the reasons that income inequality in a country is greater when education inequality is
greater. In fact, inequality is directly related to income, where in general inequality is in all
types of human capital, such as training and health, as well as in education.

Therefore, it is not surprising that the increase in income inequality in the US since the mid of
seventies of last century has resulted in large part from greater returns to training and other
education, and that many countries, such as Mexico and Brazil, have high poverty inequalities.
Inter-regional educational opportunities.

Other Matters

Although many countries have made great achievements in the advancement of education in
the world as a whole, there are still major obstacles and challenges that still need solutions, such
as increasing access to education and benefiting from the talents and skills of individuals and
opening institutions to enable the largest number of access to develop these skills, And work
on equality and improve justice and quality. The enrolment gap between the transition
economies of Europe and Central Asia and members of the Organization for Economic Co-
operation and Development (OECD) is also widening, with enrolment ratios previously low
and high in OECD countries. Countries with low and middle-income have grown at an
accelerating pace and this is the result of progress in education and the progress that has taken
place in them. This thus reduced the poverty rate in these developing countries. Whereas
primary education in most developing countries was comprehensive, noting that the MENA
region is making more remarkable progress than the countries of South Asia, while Sub-Saharan
Africa is lagging behind.

There are still great challenges in some developing countries, which is that the education rate
has decreased in some developing countries that need social justice, equality and quality
improvement, and it is important to reform the educational aspect, knowing that there are many
individuals who were unable to access or enrol in schools, especially secondary schools. Many
were unable to complete higher studies. The slowdown in reforms will hinder the growth of
countries, knowing that the slowdown in reforms is one of the important reasons that hinder
growth. The reason for the rapid growth of Asian countries, in general, is their investment in
human capital. The delay of the countries in reforming the educational system and the reforms

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cause the creation of a large gap between them and the major economic structures and vice
versa.

The issue of equality mainly affects many overlapping disadvantaged groups, including poor
linguistic and ethnic minorities, Bedouins, refugees, street children and working children. The
different access of boys and girls to the education system in some parts of the world is also very
important because it contributes to gender differences later in life. The gender gap in years of
schooling projected now is very small in most countries in Europe, Central Asia and Latin
America. It's still big in the Middle East, North Africa (MENA Region), and South Asia, where
it doesn't close at all. The quality of education is poor at all levels in low- and middle-income
countries. Students in developing countries have an average level of achievement lower than
that in industrialized countries, and their performance shows much greater variation around the
average. Delays and inaction in reforming education systems for keeping pace with economic
structures are evident in the economic transition of Eastern and Central Europe.

A slowdown in reform can stunt growth; conversely, timely reform can pay off in terms of
economic growth and poverty reduction, as evidenced by East Asian countries that have
generally invested heavily in basic human capital, both male and female. Although many
countries have made great achievements in the advancement of education in the world as a
whole, there are still major obstacles and challenges that still need solutions, such as increasing
access to education and benefiting from the talents and skills of individuals and opening
institutions to enable the largest number of access to develop these skills, And work on equality
and improve justice and quality. The enrolment gap between the transition economies of Europe
and Central Asia and members of the Organization for Economic Co-operation and
Development (OECD) is also widening, with enrolment ratios previously low and high in
OECD countries.

3. Nation's Culture and Successfully Economic Developing

There are many studies by economists on growth in the middle of the last century for more than
a hundred countries. Some countries, such as Korea, Taiwan, and Hong Kong, which were poor,
have become today among rich countries to some extent, and also that some countries started
poor, such as Nigeria and others in Africa, remained economically stagnant, but could they be
considered to have retreated? How did a country like Argentina decline knowing that it was one
of the richest countries in the world, according to these studies, education and health (healthy
life expectancy) were important determinants. Nations that possess the will and determination
are capable of becoming among the advanced economic nations. Nations with wise patriotic
leaders presenting good policies capable of building economically advanced nations in the
world. Unlike nations whose countries have retreated because of the policies that their

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governments have imposed on their people, such as Africa, Chile, Brazil and Argentina. So it
is not the cultures that prevented the progress of countries, but the policies and leaders that
imposed them.

We will not pretend that physical capital, equipment and machinery are of little importance in
the field of a modern economy. Indeed, countries need good equipment, machinery, and
factories. It also needs skilled and experienced workers, experienced and efficient managers,
and creative with innovative entrepreneurs who can use this mechanism effectively. Many
examples of countries in the world have provided the best possible machines as if they did not
achieve the desired results, on the contrary. Growth without a really strong human capital base
is not possible. Rather, success and development are dependent on peoples' investment and
deification to become the real tool for developing countries. If the people are treated badly, if
they are not trained and well educated to invest in themselves or neglect a large part of them,
then these countries are doomed to failure and will not be part of the modern world, no matter
how many resources and machines they use.

One would think that the value of having trained, educated and skilled individuals would
decline over time because there are so many of them in the world. Supply/demand analysis
which is a simple principle may show that with more supply, the price goes down. Despite the
oversupply of learners, technology is changing rapidly and dramatically in favour of better-
trained and more educated people. Therefore, despite the significant increase in the supply of
learners in the US, there has also been exponential growth in the benefits of obtaining additional
education and training in most European countries and some developing countries.

In the US, between 1930 and 1970, college graduates earned about 40% more than high school
graduates at the start of this period, while the percentage subsequently doubled to between 70
to 80%. Economic studies examined the reasons and found that the world is increasingly
competing for low-skilled jobs that are exported to Asia and also other poorer countries.
Although this happens, the main determinant seems to be technology. Sophisticated devices
such as computers, and computer literacy as well are samples of what is happening in every
field, the ability to harness and use knowledge effectively determines a nation's success.
Knowledge is power in the modern world. The same trends are happening in Western Europe.
The lack of rehabilitation and development of human capital tends to appear more and more
widely in Europe, causing an increase in unemployment. In 1980, unemployment in the US was
much higher than that of France, Germany, Sweden and many other countries in Western
Europe. There has been a complete reversal since then. France's unemployment rate is now
11%; West Germany's about 9%; Britain's; 8.5%; Sweden's 13%; Spain's 23%. Similar numbers
apply in most of the Netherlands and Belgium.

Most of the unemployed group are young people who are less educated and experienced and
have little professional investment.

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4. Human Capital and Education Policy

Policies represent the main role of human capital in the economy in terms of health, education
and other investments which are an important part of their impact on economic prosperity and
development of economic growth in countries as well as income inequality. Here we try to
clarify some basics related to education after this study, noting that we will have a series of
empirical and theoretical studies to research in this field. Public schools dominate in most
countries of Europe and America until the completion of secondary public schools because it is
where 85% of students go because it is free, and the curricula and programs of public schools
are determined according to the policies followed by a state, and here lie the problems.

This system is suitable for the upper and middle classes, where parents of students can control
the education of their children. When parents are not satisfied with the curricula or staff in
public schools, they can change schools and enrol their children in other private schools. Or
move to other areas or communities where public schools are more satisfactory. In this way,
suburban communities in most developed countries compete for families and population, partly
through the quality and capacity of public schools.

This system is unfair to poor families due to the difficulty of providing good schools for the
development of poor families with educational weaknesses. Also, disadvantaged families
cannot afford the tuition fees charged by private schools, and we rarely find that these families
move to other communities or areas that have better public schools as they are more expensive
for these families, and as a result, they accept any public schools available, regardless of how
poor they are.

To address this problem, many forms of solutions were proposed, but the most popular was the
distribution of vouchers to students to help them pay tuition fees for any school chosen by
students according to the voucher ceiling. He is a saviour in Denmark, Chile, Sweden and some
places in America. There are many studies to improve academic performance or help people
with limited income, but they remain on a small scale, and there are great difficulties to
implement them on a larger scale. Some facts are discussed about the interdependence of
investments in education, human capital, employment mechanisms and earnings, fertility and
family size, health and mortality, discrimination against girls in education, the nutritional health
system, and other methods. Overall, the issue is that investments in human capital are an
important step and one of the most important ways to combat poverty and raise the poor to
adequate levels of income, living and health.

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5. Conclusion

Any culture has the ability and potential to produce a successful developing nation, and the
core of nations is the individual, and this can only be achieved if we build educated
individuals with polished talents, and conscious trained skills.

This can be achieved through education and learning, which are indispensable to economic
development. No economic development can be achieved without quality education. It is
based not only on promoting a balanced education system for economic development, but also
enhancing productivity and generating individual income. To be a clear and noticeable
reflection on the micro level of the family. Thus, we achieve an integrated health system and
raise life expectancy, and social balance by achieving equality and opportunities, achieving
equality in income growth, increasing productivity in all societal sectors, raising the standard
of living that reduces poverty, and so on.

Most of the unemployed are young people who are less educated and experienced and have
little professional investment.

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