An Empirical Study on the Relationship between China's Education Investment and Economic Growth

Attention will be focused on education investment on the background of financial crisis. There are theoretical divergences in the studies on the relationship between Chinapsilas education investment and economic growth all along. This paper is based on the time series data from 1978-2007 and Granger causality test is applied to analysis the relationship. The results show that there is a unidirectional causality from Chinapsilas education investment to economic growth. That means increasing Chinapsilas education investment may stimulate economic growth. Naturally, increasing Chinapsilas education investment will be an effective measure to financial crisis.