Educational Achievements and Export Earnings: A Comparison between Leader and Follower Countries

Overview & Synopsis

Purpose: This study examines whether education in developing countries directly impacts their foreign income from the top export sector. Design/methodology/approach: As most developing countries follow developed nations to shape their development, this study assumes developing countries as education-follower and developed countries as education-leader countries. Considering selected countries from the South Asian Regional Cooperation (SAARC) and African countries as follower countries and Group of Seven (G7) as leader countries, this study employs Dumitrescu-Hurlin Granger non-causality tests. Findings: This study finds that education-follower countries' achievements do not directly impact foreign earnings from their leading export sectors. However, findings also confirm that leader countries have a bidirectional causal relationship between tertiary education and earnings from high technology exports. Originality/value: To the best of the authors' knowledge, this is the first study urging research-intensive education with comparative advantages in international trade. Using educational attainment on export earnings from the leading sector, findings support dependency theory in education is still existed.