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Volume 3, No. 1,
April 2004
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Temporal Causality between
Human Capital and Real Income in Cointegrated VAR
Processes: Empirical Evidence from China, 1960-1990
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Paresh Kumar Narayan
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Department of Accounting, Finance and
Economics, Griffith University, Australia
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Russell Smyth*
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Department
of Economics, Monash University, Australia
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Abstract
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This
article examines the causal relationship between human
capital and real income using data for China from 1960
to 1999. In the long run there is unidirectional
Granger causality running from human capital to real
income, while in the short run there is unidirectional
Granger causality running from real income to human
capital.
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Key words
:
China; human capital;
income; cointegration; Granger causality
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JEL classification
:
C12; C22; I2
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