Investigating the Effects of Institutional Factors and Human Capital on Economic Growth

In this study, the effects of institutional factors and human capital on economic growth in developing countries are examined. For this purpose, by using the panel data during the years 2010-2018 for a selection of developing countries, the results show that institutional factors such as indicators of business regulation and emerging entrepreneurship foreign direct investment, human capital and the formation of gross domestic fixed capital has a positive and significant effect on the economic growth of selected countries. In addition, the business regulation index, government spending on education and economic growth rate has ‌a positive and significant effect on the business climate index in developing countries. Therefore, based on the findings of the study, the need for development oriented strategic planning in order to implement institutional and legal requirements to facilitate business environment and encourage entrepreneurship, as well as reform and changing general, vocational and specialized education programs with the approach of training potential entrepreneurs, can provide suitable conditions for the emergence of entrepreneurial businesses, especially technology based.