Education, institutions, and investment as determinants of economic growth in Central Asia and the Caucasus : a panel data analysis

Economic growth and development are key to societal well-being, yet emerging economies in Central Asia and the Caucasus face challenges such as labor market inefficiencies, uneven capital distribution, and weak institutions. This study examines the impact of education, institutional quality, capital investment, and labor force dynamics on economic growth in the region from 2010 to 2023. Using panel data analysis, including unit root tests, cointegration tests (Pedroni and Kao), and FMOLS/DOLS estimation, the findings reveal that while education and capital investment drive growth, institutional factors show mixed effects. Higher tertiary education enrollment correlates with long-term economic expansion, whereas weak governance and corruption hinder progress. This study contributes to the literature by providing empirical evidence on education and institutional roles in economic performance, offering policy insights for sustainable growth. The results highlight the need for governance reforms, education quality improvements, and labor market adaptability to enhance economic potential.