The Contribution of Human Capital Investment in the Growth of East Asian Economy – A Literature Review


  • Nabaz Nawzad Abdullah School of Law, Government and International Studies University Utara Malaysia
  • Masayu binti Othman School of Law, Government and International Studies University Utara Malaysia


human capital, individual capital, economic development, technology, investment


Human capital as the wealth of nation supports the economy in a variety of ways. This study intended to elucidate the significance of education, technology utilization and health investment in economic affluence of East Asia. The finding shows a significant relationship between human capital investment and economic growth in East Asia. Human capital investment has become an essential tool to determine nations productivity in both, micro and macro level. The findings come across to assume that, in order to be successful, HC investment through the improvement of technology, education and health system must be cautiously considered in any endeavor towards economic development and sustainability. The study concluded that a person with poor health, lack of knowledge or vocational training will offer less, theoretically, than a person who has been specifically trained or who has attained a higher level of education.


Abdullah, A. J. (2013). Education and Economic Growth in Malaysia: The Issues of Education Data. Procedia Economics and Finance, 7, p. 65–72

Arora, S. (2001). Health Human Productivity and Long-Term Economic Growth. Journal of Economic History, p. 61 (3).

Babalola, H. (2003). Economic growth and human development. Nsukka, University Press

Barro, R., Lee, J. W. (1993). International Comparisons of Educational Attainment. Journal of Monetary Economics, 32, p. 363-94.

Barro, R., Sala-i-Martin, X. (1997). Technological Diffusion, Convergence, and Growth. Journal of Economic Growth, 2 (1), p. 1-26.

Becker, G. S. (1998). Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education. 2nd ed. Massachusetts: NBER

Boldrin, M., Chen, B., Vang, P. (2004). Human Capital, Trade And Public Policy In Rapidly Growing Economies: From Theory To Empirics. Cheltenham: Edward Elgar Publishing

Chongsuvivatwong et al. (2011). Health in Southeast Asia: Health and health-care systems in South East Asia: diversity and transitions. Series, 377, p. 429-437.

Cole, M., Neumayer, E. (2009). The Impact of Poor Health on Total Factor Productivity. Journal of Development Studies, 42, (6), p. 918–938.

Dahal, M. P. (2010). Higher education enrollment, school, teachers and GDP in Nepal: A Causality Analysis. Economic Journal of Development Issues, p.12 (2).

Dobrzanski, L. A. (2009). Editorial: Achievement in Materials and Manufacturing Engineering. Journal of Achievements in Materials and Manufacturing Engineering, 36 (1), 4.

Edgard, B., Cornachione, Jr. (2010). Investing in Human Capital: Integrating Intellectual Capital Architecture and Utility Theory. The Journal of Human Resource and Adult Learning, 6 (1).

Haldar, S. K., Mallik, G. (2007). Does Human Capital Cause Economic Growth? A Case Study of India. International Journal of Economic Sciences and Applied Research, 3 (1), p. 7-25.

Hall, B. W. (2008). The New Human Capital Strategy: Improving the Value of Your Most Important Investment- Year after Year. New York: AMACOM.

Hussin, M. Y., Muhammad, F., Abdul Razak, A. (2012). Education Expenditure and Economic Growth: A Causal Analysis for Malaysia. Journal of Economics and Sustainable Development, 3, (7), p. 71-81.

Islam, R. (2003). Revisiting the East Asian Model of Economic Growth and Poverty Reduction: A Labour Market Perspective. Retrieved March 10, 2015, from

Lange, L., Topel, R. (2005). The Social Value of Education and Human Capital. In Hanushek, E. and Welch, F. (eds.) Handbook of the Economics of Education, p. 459-510. Amsterdam: Elsiver.

Latif, N. W., Yusof, N. Y. (2007). The Impact of Education on Economic. Growth: The Case of Malaysia. Pahang: Universiti Tenaga Nasional

Lucas, R. (1988). On the Mechanics of Economic Development. Journal of Monetary Economics, 22, p. 3-42.

Lutz et al. (2004). The End of World Population Growth in the 21st Century: New Challenges for Human Capital Formation and Sustainable Development (Population and Sustainable Development). 1st edition. London: Rutledge

Marshall, A. (1930). Principles of Economics. London: Macmillan.

Moran, P. (2005). Social vs. Relational Embeddedness: Social Capital and Managerial Performance. Strategic Management Journal, 26, p. 1129–1151. OECD (2013). OECD Reviews of Innovation Policy Innovation in Southeast Asia. OECD Publishing

Olaniyan. D. A., Okemakinde, T. (2008), European Journal of Scientific Research. 24 (2), p. 157-162. Phan, D., Coxhead, I. (2013). Long-run costs of piecemeal reform: Wage inequality and returns to education in Vietnam. Journal of Comparative Economics, 41 (4), p. 1106–1122.

Psacharopoulos, G., Woodhall, M. (1997). Education for Development: An Analysis of Investment Choice. New York: Oxford University Press Saigosoom, N. (2013). Barriers and opportunities for small and medium-sized Thai food firms in the context of innovation management: The case of processed marine and processed fruit and vegetable sectors (Doctoral Thesis). University of Manchester, Manchester, UK

Schultz, T. W. (1961). Investment in Human Capital. American Economic Review, 51, p. 1-17.

Shaar, M. (2014). Education-led Economic Growth in Malaysia. SOP Transactions on Economic Research, 1 (1), p. 27-33.

Sindakis, S., Walter, C. (2015). The Entrepreneurial Rise in Southeast Asia: The Quadruple Helix Influence on Technological Innovation. New York: Springer.

Son, H. H. (2010). Human Capital Development. Asian Development Review, Vol. 27 (2), p. 29-56.

Tallman, E. W., Wang, P. (1994). Human Capital and Endogenous Growth, Evidence from Taiwan. Journal of Monetary Economics, 34, p. 101 - 124.

Tilak, J. B. J. (2002). Building Human Capital in East Asia: What Others Can Learn. Washington D. C: World Bank.

Tzannatos, Z. (1997). Training and Skills Development in the East Asian Newly Industrialized Countries: a comparison and lessons for developing Countries. Journal of Vocational Education and Training, 49, (3).

Woodhall, M. (1997). Education for Development: An Analysis of Investment Choice. New York: Oxford University Press.