THE IMPACT OF HUMAN CAPITAL ON TOTAL FACTOR PRODUCTIVITY IN INDUSTRIAL SECTOR IN THE EAST AZARBAIJAN PROVINCE

Productivity improvement is one of the important factors in economic growth.. This paper attempts to study the impact of human capital on Total Factor Productivity in the industrial sector of East Azarbaijan Province in Iran during the period 1374-1385 (1994-2005). To probe the impact of human capital on Total Factor Productivity, the Data Envelopment Analysis (DEA) technique the Malmquist Index have been applied. The results indicate that the management efficiency, as an index of human capital, affects the TFP to almost the same extent as other factors.