International Journal of Business and Economics Volume 3, No. 1 April​, 2004

Temporal Causality between Human Capital and Real Income in Cointegrated VAR Processes: Empirical Evidence from China, 1960-1990

Paresh Kumar Narayan

Department of Accounting, Finance and Economics, Griffith University, Australia

Russell Smyth

Department of Economics, Monash University, Australia

Abstract

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.

Keywords：China, human capital, income, cointegration, Granger causality.

JEL Classifications： C12, C22, I2.

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