Abstract:

Huge investment in human capital is an important determinant in improving economic growth, the quality of human capital through investment in education and health improves the living standard of people and societal welfare. Hence, this study empirically examines the impact of human capital variables on poverty reduction in selected OPEC member countries from 1980 to 2016. It also sought to examine the interactions between countries spending on education and health meeting the minimum global benchmark of budgetary allocations of these sectors. Using tabular analysis, descriptive statistics, graphical representations and econometrics techniques, it was discovered that OPEC member countries that spend above the globally recommended annual public investment benchmarks in education has achieved high rate of reduction in poverty rate as compare to the countries spending above benchmarks on health. By implication, OPEC member countries would need to invest more petroleum revenues in human capital through sustainable education and health programs rather than over spending on less productive sectors. This will enhance economic growth and labor productivity.