Analysis of Inter- Province Spatial Spillover Effects of Human ‎Capital on Economic Growth in Iran

Human capital has important role on economic growth. This factor can increase labor and capital productivity. It can increase capacity of new technology and reduce criminal participation and improve voters’ political behavior and migration of people with high human capital to another region has effects on region and spatial spillover on other regions.
The present study aimed to analyze the direct and spatial spillover effects of human capital on economic growth in provinces of Iran. For this aim, we estimate a Spatial Durbin Model in panel data by using ML technique for 28 provinces over the period 2001-2011. The results indicated that human capital has a positive and significant direct effect on economic growth of each province. Also, human capital has a significant and positive spatial spillover on economic growth in other provinces. This means that with increase human capital of each province, increase average of economic growth of other provinces.