Causality Analysis of the Nexus between Higher Education and Income Distribution in Iraq

Abstract

The achievement of economic and social welfare for individual is the main target to all policies that adopted by all countries worldwide either were economic, social, political or others. The obtaining of education by individuals and especially the higher education is one of the most important determinates in achieving the wellbeing and lasted economic development. This is because via the higher education new fields can be opened in front of individuals in order to get adequate jobs associated with their scientific specialization. This is allowing educated individuals gain higher income that can reduce the gap of income inequality.Thus, this paper aims to analysis the nexus between the level of higher education and equality of income distribution in Iraq during the period 1990-2014. We means by the level of higher education the number alumnus who obtains the undergraduate degree as well as post graduate. By using the test of cointegration and Granger causality, the paper found that there is not nexus between the level of income (salary) and the level of higher education in Iraq. Therefore, the paper suggests a number of policies need to be implemented to improve the equality of income distribution in Iraq such as: increases the number of alumnus, encouraging the study loans especially for poor, and also improve the quality of education provided by the Iraqi universities to facilitate getting jobs inside Iraq and abroad.