THE CORRELATION BETWEEN EDUCATION AND HUMAN CAPITAL AND THEIR IMPACT ON THE CREATION OF A KNOWLEDGE-BASED ECONOMY

Abstract

Education and scientific research are the main channels through which human capital and knowledge are generated. Human capital and knowledge are thus the basic determinants of economic growth and development in modern knowledgebased economies and are recognized as the key factor inputs which increase the assets of the entire economy. Nowadays, world economies are rapidly restructuring to be knowledge-based, and investment in human capital is a significant contributor to the economic growth. Competitiveness between knowledge-based economies conditions that comparative advantage of any economy be the cumulative human capital, knowledge and innovation. This paper, using the scientific methods of historical comparative analysis, trend linear analysis and the method of induction and deduction, explores the transmission channels of the impact of education on economic growth and development in N. Macedonia, draws comparisons with countries in the region and proposes measures for improvement.