The human capital – Green growth nexus in South Africa

Orientation: Exasperating environmental degradation has necessitated an increased focus on strategies and policies that emphasise green growth. Research purpose: This study explores the effect of green growth on human capital development in South Africa. Motivation for the study: Despite the alarming environmental degradation and the growing demand for green growth, the effect of green growth on human capital development remains largely unexplored. Research approach/design and method: The study employs an Autoregressive Distributed Lag (ARDL) framework to examine the relationship between green growth and human capital development in South Africa. The model used secondary data from 1990 to 2021. Main findings: The results confirm the existence of a long-run, positive, significant relationship between green growth and human capital development. Educational expenditure and financial development also showed a positive and significant effect on human capital development. In contrast, trade openness was found to have a negative and insignificant effect on the dependent variable. Practical/managerial implications: The implications of these results suggest that South Africa should prioritise green growth strategies, not only as a means of promoting environmental sustainability but also as a catalyst for human capital development. Contribution/vale-add: This study provides South Africa–specific evidence on the long-run relationship between green growth and human capital using an ARDL (bounds testing) approach, highlighting the roles of education expenditure and financial development for policy.