DOES HIGHER EDUCATION LEAD TO HIGHER INCOME IN UZBEKISTAN? AN ECONOMETRIC ANALYSIS OF REGIONAL DATA

Abstract

This study investigates the causal relationship between higher education attainment and income levels in Uzbekistan, using an augmented Ordinary Least Squares (OLS) regression model on a balanced panel dataset from the State Statistics Committee of Uzbekistan (SDMX Data 500) for the period 2017–2024. The analysis reveals a strong and statistically significant positive association between the share of higher-educated individuals and average regional income, even after controlling for urbanization, regional GDP per capita, and industrial composition. A one percentage point increase in the higher education share is associated with an average rise of 85,000 soums in the nominal monthly wage. The model explains 82% of the wage variation across regions, robust to a series of diagnostic tests. The findings robustly confirm the theoretical expectations of human capital theory, demonstrating that education remains a critical determinant of economic prosperity and a key mechanism for reducing regional inequality in transitional economies like Uzbekistan. Policy implications strongly advocate for targeted investments in tertiary education infrastructure, equitable access through scholarship programs, and curricular reforms aligned with labor market demands to foster sustainable and inclusive economic growth.