Human capital and its role in the progress of production have been in
the core of attention to the economic literature, Additionally, human
capital not only increases numbers of skilled and trained labors, which
can lead to a higher rate of productivity, but also provides grater
opportunities of economic growth and development.
The present paper thus evaluates the effect of promoting higher
education on Irans Manufacturing Export supply.
To this end, a simultaneous equation system including both
endogenous and exogenous variables, particularly higher education as
an exogenous variable, is specified in order to make a systematic and
theory-based relationship between such variables, Each equation of the
model is then estimated by applying the weighted two stage least
squares(W2SLS)methodoverthe period 1966- 1999,to examinethe
impact of higher education promotion on Irans non-oil Exports,
Overall, estimation results obtained look reliable, so that they
represent statistically expected significance of equation coefficients
available in the system. According to the results obtained, a scenario of
20 percent increase in the value of higher education variable (normally
in the fonn of the ratio of all higher educated employees to total
employees in the Manufacturing sector) is conducted, and then the
relevant model is simulated by the analytic Newton Method. The results
reveal an increase of about 16 percent per annum on average in
Manufacturing Exports. The implication is that the conduction of such
policy on Iranian Export sector can expand structurally its related
market.