Abstract

Objectives: This study examines the role of human capital formation in promoting non-oil economic growth in the Kingdom of Saudi Arabia. Methods: The methodology adopted combines the inductive approach, which traces the key theoretical developments, with the deductive approach, which is employed to test the study's hypotheses and verify their validity. The research depends on estimating An Autoregressive Distributed Lag (ARDL) model by using annual data during the period (1990-2022). Results: The findings reveal the existence of a long-term cointegrated relationship between human capital indicators, traditional production inputs (such as labor force size and physical capital), and non-oil economic growth in Saudi Arabia. Furthermore, the study demonstrates a significant and positive effect of human capital on non-oil economic growth. Conclusions: This confirms that the more crucial element in advancing the Saudi economy and supporting economic diversification is fostering human capital formation through education in particular.