Determinants of Human Development in Arab Countries: The Impact of Economic Growth, Capital Formation, Trade Openness, and Political Stability Using Panel Data for the Period 2000–2024
Cheriet Hanane1* 
, Bendjemil Hana1
Abstract. This study aims to identify the main determinants of human development in a group of Arab countries over the period 2000–2024 by examining the effects of economic growth, gross capital formation, trade openness, and political stability. To achieve this objective, the study employs panel data and applies the Panel ARDL approach using the Pooled Mean Group (PMG) estimator to investigate both short- and long-run relationships among the variables. The results reveal a positive and statistically significant effect of GDP per capita on human development in both the short and long run, with a long-run coefficient of 0.244873. Gross capital formation has a positive and statistically significant effect in the short run, whereas its long-run effect is statistically insignificant. The findings also indicate that political stability has a positive and statistically significant effect on human development in the long run, with a coefficient of 0.535452, while its short-run effect is negative and statistically significant. Trade openness likewise exhibits a positive and statistically significant long-run effect, with a coefficient of 0.175670, whereas its short-run effect is statistically insignificant. The error-correction coefficient, estimated at −0.229904, confirms the existence of a long-run equilibrium relationship, with approximately 22.99% of short-run deviations from equilibrium being corrected within one period. Overall, the findings highlight the importance of economic growth, political stability, and trade openness in promoting human development in Arab countries, while emphasizing the need to direct investment toward areas that contribute to human capital development.
Keywords: human development, economic growth, gross capital formation, trade openness, political stability, panel data, panel ardl, pooled mean group (pmg), arab countries