The neoclassical growth model is tested by use of panel data procedure in this research. In the econometric test, simoultanously time series and cross detection will be compared on the basis of panel data method through which their observed points increase and consequently the estimation efficiency will be increased.
The examination of neoclassical growth theory has been done with reference to external & internal factors of 52 selected countries from 1960 to 2000. The independent variable of model has been selected on the basis of the result of previous research which explains the result in three separate models: developed countries, developing countries, and whole countries.
These factors are such as: Gross National Products with lag of period, work force age, growth rate, education level, the change of capital accumulation and economic trade volum. The consequences of this research is that: neoclassical growth model can explain the major part of economic growth of the countries with use of internal variables.
Also with the use of panel procedure of fixed effect, we can see the fundamental differences and structure of the growth process for different countries; and show how the economic, and social conditions affect on the
growth.