Education and Economic Growth: A Case Study of Australia

Document Type

Journal Article


Faculty of Business and Law


School of Accounting, Finance and Business Economics




Matsushita, S., Siddique, A., & Giles, M. (2006). Education and economic growth: a case study of Australia. DISCUSSION PAPER-UNIVERSITY OF WESTERN AUSTRALIA DEPARTMENT OF ECONOMICS, 15.


The purpose of this paper is to measure the contribution of education to growth in per capita real GDP in Australia over the period 1969-2003 using the growth accounting method. Also estimated is the contribution of total factor productivity to growth. Over the period, per capita real GDP in Australia increased by 1.9 per cent per annum. Of this, about 31 per cent was contributed by education. This finding has important implications for policy makers in Australia. For example, in order to promote economic growth in coming years, access to post compulsory education, particularly vocational education and training and higher education, for all Australians should be made easier and cheaper. This contradicts recent trends at the federal level towards increasing the student share of education costs. Total factor productivity is estimated at 46 per cent per annum.

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