The impact of Education and Health Infrastructures on Economic Growth of Iran

Infrastructures are one of the most important tools for transferring technology from developed countries to developing ones. These infrastructures will also increase the economic activities; decrease the production and transportation costs, and finally increase the efficiency. Thus, they can affect the economic growth. This study investigates the direct and indirect effects of education and health, and economic infrastructures on the economic growth of Iran from 1980 to 2011. To that end, an equation system was designed which uses 2SLS. The findings showed that one percent increase in the education and health infrastructures will increase GDP by 0.06, and increase the foreign direct investment by 0.03. The indirect effect of improving education and health infrastructures on economic growth via foreign investment is 0.06 while export can bring about a 0.02 increase in economic growth.