Dynamic Effects of the Chinese GDP and Number of Higher Education Based on Cointegrating

Abstract

This study’s objective was to the issue for the impact between regular higher education scale and GDP in China. We integrate Unit Root Test, Cointegration Test, Vector Error Correction Model (VECM), Variance Decomposition, etc. The sample is to use the annual data of GDP and number of Students Enrollment of Regular Institutions from 1952 to2004. Empirical results show that there is co-integration relation between GDP and number of Students Enrollment of Regular Institutions and economic growth can affect higher education scale and the contribution of education to economic growth is increasing gradually. To achieve good interaction between higher education and economic growth, the advice is that make scientific policy of regular higher education scale’s expansion.Key Word: Gross Domestic Product (GDP); Granger causality test; Vector Error Correction Model; Cointegration Test; number of Students Enrollment of Regular Institutions