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THE IMPACT OF TECHNOLOGICAL ADVANCEMENT ON THE INDUSTRIAL SECTOR PRODUCTIVITY: SOLOW MODEL APPROACH

SHATHA YOUSEF ABDEL KHALEQ 1, RUBA NIMER ABU SHIHAB 2, and AHMAD YOUSEF KALBOUNEH 3.

Vol 17, No 12 ( 2022 )   |  DOI: 10.5281/zenodo.7462960   |   Author Affiliation: Al-Zaytoonah University of Jordan 1; Al-Balqa Applied University 2,3.   |   Licensing: CC 4.0   |   Pg no: 1125-1137   |   To cite: SHATHA YOUSEF ABDEL KHALEQ, et al., (2022). THE IMPACT OF TECHNOLOGICAL ADVANCEMENT ON THE INDUSTRIAL SECTOR PRODUCTIVITY: SOLOW MODEL APPROACH. 17(12), 1125–1137. https://doi.org/10.5281/zenodo.7462960   |   Published on: 20-12-2022

Abstract

This paper aims to analyze the impact of human capital on the Jordanian industrial sector productivity. For the objectives of analysis, the researcher will use time series data for the Jordanian industrial sector. Accordingly the researcher will analyze two kinds of mathematical and econometrics functions. The mathematical model for measuring the total productivity will be used through CobbDouglas Function, and then the previously accounted productivity will be used and replaced in the econometrics model used in the estimation. This study depends on Solow Model. The study had shown that the variables of human capital and inflation had achieved a statistical significance of less than 1%, as the increase in the number of employees with basic education by 10% led to a rise in total productivity growth with 0.07, this was in line with the economic theory which assumed that there was a direct relationship between human capital and total productivity in the industrial sector. In addition, the estimation results had shown that there was a direct relationship between the financial development index and total productivity in the industrial sector, as the high level of the financial sector contributed to providing credit facilities to the industrial sector with an increase in the total productivity in this sector.


Keywords

Productivity, Solow Model, Industrial Sector, Technological Advancement, Jordan