Abstract:
Trade is the principal channel through which the flow of ideas, knowledge and technology will take place. But it is not clear to what extent the recipient country can take advantage of these variables. Adoption, imitation and production process,by and large, depend on human capital in the recipient country, and also on how the different components of human capital (e.g. on-the-job-training versus academic training) are distributed. This paper uses Ordinary Least Square to investigate relationship between trade, human capital and economic growth. The empirical result shows that there is a significant relationship between trade, human capital and economic growth. The study shows that any progress in human capital will positively affect economic growth. In turn, higher economic growth will lead to more employment, higher income and profit, which means more investment in human capital.