Business and Economic Research ISSN 2162-4860 2020, Vol. 10, No. 2 http://ber.macrothink.org 182 The Impact of Human Capital and Foreign Direct Investment on Economic Growth: An Empirical Study on Jordan Mustafa Mohammad Alalawneh School of Economic and Management, Khazar University Baku, 122 Bashir Safar-Oghlu St, Baku 1009, Azerbaijan E-mail: falconengineer81@yahoo.com Received: March 26, 2020 Accepted: April 24, 2020 Published: May 6, 2020 doi:10.5296/ber.v10i2.16747 URL: https://doi.org/10.5296/ber.v10i2.16747 Abstract Human capital is a real factor in improving the investment climate and attracting foreign investment. FDI also increases human capital in the host country through the transfer of advanced technology and the rehabilitation of local labor. The importance of the study comes from Jordan's serious endeavor to attract foreign direct investment and to present itself as a rich country in human and qualified capacities. This study examines the effect of human capital and foreign direct investment on economic growth in Jordan employing Auto Regressive Distributed Lags Bounds Testing (ARDL BT) co-integration method for the spanning period from 1984 to 2018. The results indicate that there is a long- run relationship among variables. The results showed that there is a negative and statistically significant effect of human capital index (HCI) on economic growth (GWP) in the long run, and a positive and statistically significant effect of FDI (GFDI) on economic growth (GWP) in the long run. The estimation results indicate that a 1% increase in (HCI) decreases (GWP) by 0.272%, and a 1% increase in (GFDI) increases (GWP) by 0.006%. This study is one of the few studies that highlight the challenges facing both HC and FDI in increasing economic growth in Jordan and provides some recommendations. Keywords: Human Capital, Foreign Direct Investment, ARDLBT, Jordan 1. Introduction The early beginnings of economic theories focused on the importance of physical capital in economic activity . Attention was paid to material wealth at the expense of human, and to maximize income at the expense of expanding opportunities for people. But with the