Internationalisation of education and its effect on economic growth and development

This study examines the effect of education export on economic growth and development, using Australia as a case study since it is one of the top destinations for international students. International education has played a vital role in Australia's economy over the last three decades, becoming the third-largest export of Australia after iron ore and coal, and earning AU$40.3 billion in 2019. The sector supports about 250,000 jobs and provids an important source of skilled migrants for Australia. This study employs the cointegration and error correction model and quarterly data from 1974 to 2019 to analyse the effect of internationalisation of education on the Australian economy. The results suggest a long-run positive relationship and a short-run dynamic effect of international education on the economic growth and employment of Australia. The findings of this study have far-reaching implications for other education-exporting countries. Policy recommendations suggest taking proactive, flexible and innovative approaches to attract international students, and diversifying the market can support further growth of the sector and enhance the economy-wide spillover effects. The study proposes sound and timely policies to promote the internationalisation of education to augment not only economic growth but also long-run development for both education-exporting and -receiving countries.