Date of Award

Winter 2011

Document Type


Degree Name

Doctor of Philosophy (PhD)


Educational Foundations & Leadership


Educational Leadership

Committee Director

William A. Owings

Committee Member

G. Lea Lee

Committee Member

Christopher Colburn


The impact of investment in human capital on economy has always been discussed in the literature. Existing studies in the literature generally focus on short term impacts of investment in human capital. While some studies see significant impact, some other ones see little or no impact. This study manipulated data that was cover a long span of time, a 25-year period. In this study the researcher inquired whether there is a significant correlation between education and economy in terms of the impacts of investment in human capital on unemployment over a long span of time. In this empirical study panel data regression analysis was used to examine to what extent variations in the dependent variable of interest could be explained by variations in the explanatory variables. Based on the last and the most complete specification-the specification with five-year lags and state and time fixed-effects- employed in this study education spending per pupil and health spending are the only variables that negatively affect unemployment. This result suggested that the only way to effectively reduce unemployment is investment in improving the quality of human capital through better education and health services.