Relationship between Income Inequality, Human Capital Development, Foreign Direct Investment, and Economic Growth in Developing Countries

Abstract

This paper examines earnings inequality, human capital improvement and overseas direct investment (FDI) and monetary increase in growing nations, specifically Pakistan, among the 12 months 2000-2023. The observe applies the quantitative studies layout the usage of secondary panel facts of the World Bank, International Monetary Fund (IMF), and United Nations Development Programme (UNDP) with GDP increase price because the based variable in which FDI inflows, Gini index and training index are the unbiased variables. They are descriptive statistics, correlation analysis, and panel regression models, namely, constant effect (FE) and random effect (RE) models. Hausman check is implemented to examine the version specification this is needed. The outcomes display that the improvement of human capital and FDI have a effective effect at the monetary boom, while excessive profits inequality has a terrible effect, in particular in low-profits growing economies. The paper gives coverage pointers that may be used to mitigate inequality and beautify human capital to draw effective FDI to maintain financial increase.