The Impact of Human Development on Economic Growth: Emphasizing Bangladesh
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Development is the key to surviving any new change in our way, be it biological or economical. Bangladesh, as a developing country has also been focusing on the human development policies to face the challenges of a growing economy. The aim of this research paper is to empirically test the significance and direction of the impact of human development measured with Human Development Index (HDI) on economic growth, measured with Gross Domestic Product (GDP) – in Bangladesh. 30 years (1990-2019) of time series data for the country, has been used to achieve the objective empirically. Using secondary data from World Bank, Macrotrends, and Country Economy, we have used the ordinary least squares (OLS) model for the test. Based on the research of Harrod (1939), we were anticipating a positive and significant impact of HDI on GDP. We tried to answer the question, how much and how significantly HDI is affecting the growth of GDP in Bangladesh. The rationale behind conducting this study is to contribute to making better policies directed toward economic growth and human development, so that it can eventually improve human welfare in Bangladesh. This research found a positive and significant effect of HDI on GDP. Though it is limited to only OLS regression models without further tests, this study can be further used by carrying out unit root tests to get better results.