본문 바로가기
KERD
논문KCI 등재

The optimum size of public education spending: the evidence from the developed, developing and transition economies

Ivan D. Trofimov
경제연구소 (Hanyang Economic Research Institute)|2021.08|Journal of Economic Research (JER)|제26권 제2호|pp. 159-190|DOI 10.17256/jer.2021.26.2.003

2

조회

0

다운로드

0

인용

0

참고문헌

키워드

growthdeveloping countriesEducation expendituregovernment size
주제분류경제학

초록

The paper examines the presence of positive effect of public education spending in a panel of 50 developed, developing and transition economies (over the 1980-2012 period) on the level and growth of output, and, provided such effect holds, considers the optimal provision of public education spending. The econometric methodology relies on panel unit root and cross-sectional dependence tests, panel regression with fixed effects, and panel quantile model with fixed effects. It is demonstrated that public education spending is productive at the margin under alternative specifications, and has positive externalities on the private economy, while the factor productivity in the government sector is higher than in the private. For the panel as a whole, the public education tended to be under-provided (the optimal level of 5.05% of GDP compared to the actual average level of 4.14% of GDP); however, the over-provision is observed in the slow-growing economies in the lower quantiles.

Abstract

The paper examines the presence of positive effect of public education spending in a panel of 50 developed, developing and transition economies (over the 1980-2012 period) on the level and growth of output, and, provided such effect holds, considers the optimal provision of public education spending. The econometric methodology relies on panel unit root and cross-sectional dependence tests, panel regression with fixed effects, and panel quantile model with fixed effects. It is demonstrated that public education spending is productive at the margin under alternative specifications, and has positive externalities on the private economy, while the factor productivity in the government sector is higher than in the private. For the panel as a whole, the public education tended to be under-provided (the optimal level of 5.05% of GDP compared to the actual average level of 4.14% of GDP); however, the over-provision is observed in the slow-growing economies in the lower quantiles.

참고문헌 (76)

  1. Afonso, A., "Government size, composition, volatility and economic growth", European Journal of Political Economy, 26(4), pp.517~532 (2010)
  2. Alleyne, K.-A., "An assessment of the growth-enhancing size of government in the Caribbean", Applied Econometrics and International Development, 4(3), pp.77~94 (2004)
  3. Aly, H., "Is government size optimal in the Gulf countries of the Middle East? An empirical investigation", International Review of Applied Economics, 14(4), pp.475~483 (2000)
  4. Angelopoulos, K., "Does public sector efficiency matter? Revisiting the relation between fiscal size and economic growth in a world sample", Public Choice, 137(1, pp.2) (2008), 245~278
  5. Annabi, N., "Public expenditures on education, human capital and growth in Canada: An OLG model analysis", Journal of Policy Modeling, 33(6), pp.852~865 (2011)
  6. Armey, D., "The freedom revolution" (1995), Regnery Publishing
  7. Baumol, W., "Macroeconomics of unbalanced economic growth: The anatomy of the urban crisis", American Economic Review, 57, pp.415~426 (1967)
  8. Benhabib, J., "The role of human capital in economic development - Evidence from aggregate cross-country data", Journal of Monetary Economics, 34(2), pp.143~173 (1994)
  9. Bosworth, B., "The empirics of growth: An update", Brookings Papers on Economic Activity, 2, pp.113~206 (2003)
  10. Chao, J.C.P., "How to use fiscal surplus - What is the optimal size of government?" (1998), The Fraser Institute
  11. Chiou-Wei, S.-Z., "Government size and economic growth: An application of the smooth transition regression model", Applied Economics Letters, 17(14), pp.1405~1415 (2010)
  12. Choi, I., "Unit root tests for panel data", Journal of International Money and Finance, 20(2), pp.249~272 (2001)
  13. De Meulemeester, J.-L., "Causality analysis of the link between higher education and economic development", Economics of Education Review, 14(4), pp.351~361 (1995)
  14. De Witte, K., "Sizing the government", Public Choice, 145(1, pp.2) (2010), 39~55
  15. Dissou, Y., "Government spending on education, human capital accumulation, and growth", Economic Modelling, 58, pp.9~21 (2016)
  16. Optimal government size and economic growth in France (1871-2008): An explanation by the state and market failures, "Facchini, F.", Centre d’Economie de la Sorbonne, ~ (2011)
  17. Folster, S., "Growth effects of government expenditure and taxation in rich countries", European Economic Review, 45(8), pp.1501~1520 (2001)
  18. Francis, B., "Education and development in the Caribbean: A cointegration and causality analysis", Economics Bulletin, 15(2), pp.1~13 (2006)
  19. Freire-Seren, M., "Human capital accumulation and economic growth", Investigaciones Economicas, 25(3), pp.585~602 (2001)
  20. The benefits are at the tail: Uncovering the impact of macroprudential policy on growth-at-risk, "Galan, J.E.", Banco de Espana, 1~39, pp.Documentos de Trabajo No. 2007 (2020)
  21. Ghose, A., "Government size and economic growth in emerging market economies: A panel co-integration approach", Macroeconomics and Finance in Emerging Market Economies, 6(1), pp.14~38 (2013)
  22. Glomm, G., "Flat-rate taxes, government spending on education and growth", Review of Economic Dynamics, 1(1), pp.306~325 (1998)
  23. Goel, R.K., "R&D expenditures and U.S. economic growth: A disaggregated approach", Journal of Policy Modeling, 30(2), pp.237~250 (2008)
  24. Gozgor, G., "Energy consumption and economic growth: New evidence from the OECD countries", Energy, 153, pp.27~34 (2018)
  25. Grubb, W., "States and schools: The political economy of public school finance" (1974), Lexington Books
  26. Gunalp, B., "Government expenditures and economic growth in developing countries: Evidence from a panel data analysis", METU Studies in Development, 29, pp.311~332 (2002)
  27. Gupta, S., "The efficiency of government expenditure:Experiences from Africa", Journal of Policy Modeling, 23(4), pp.433~467 (2001)
  28. Hajamini, M., "The nonlinear impact of government consumption expenditure on economic growth: Evidence from low and low-middle income countries", Cogent Economics and Finance, 2(1), pp.1~15 (2014)
  29. Executives’ short-term and long-term incentives - A distributional analysis, "Haylock, M.", University of Tubingen, ~, pp.Working Paper in Business and Economics No. 131 (2020)
  30. Hoechle, D., "Robust standard errors for panel regressions with cross-sectional dependence", The Stata Journal, 7(3), pp.1~31 (2007)
  31. Im, K.S., "Testing for unit roots in heterogeneous panels", Journal of Econometrics, 115(1), pp.53~74 (2003)
  32. International Food Policy Research Institute, "Statistics on public expenditures and economic development (SPEED)" (2015), International Food Policy Research Institute
  33. Islam, N., "Growth empirics: A panel data approach", Quarterly Journal of Economics, 110(4), pp.1127~1170 (1995)
  34. Islam, T., "Relationship between education and GDP growth: A multivariate causality analysis for Bangladesh", Economics Bulletin, 3(35), pp.1~7 (2007)
  35. Jung, H., "The impact of public education expenditure on human capital, growth, and poverty in Tanzania and Zambia: A general equilibrium approach", Journal of Policy Modeling, 25(8), pp.701~772 (2003)
  36. Jurges, H., "International differences in student achievement:An economic perspective", German Economic Review, 5(3), pp.357~380 (2004)
  37. Karras, G., "The optimal government size: Further international evidence on the productivity of government services", Economic Inquiry, 34(2), pp.193~203 (1996)
  38. Karras, G., "On the optimal government size in Europe: Theory and empirical evidence", The Manchester School, 65(3), pp.280~294 (1997)
  39. Koenker, R., "Quantile regression for longitudinal data", Journal of Multivariate Analysis, 91(1), pp.74~89 (2004)
  40. Koenker, R., "Quantile regression" (2005), Cambridge University Press
  41. Koenker, R., "Regression quantiles", Econometrica, 46(1), pp.33~50 (1978)
  42. Education for growth in Sweden and the world, "Krueger, A.", NBER, ~, pp.NBER Working Paper No. 7190 (1999)
  43. Landau, D., "Government expenditure and economic growth: A crosscountry study", Southern Economic Journal, 49(3), pp.783~792 (1983)
  44. Levin, A., "Unit root tests in panel data: Asymptotic and finite-sample properties", Journal of Econometrics, 108(1), pp.1~24 (2002)
  45. Levy, J., "Public education expenditure and private investment in developing countries", Economics Letters, 53(3), pp.331~336 (1996)
  46. Machado, J., "Quantiles via moments", Journal of Econometrics, 213(1), pp.145~173 (2019)
  47. Maddala, G.S., "A comparative study of unit root tests with panel data and a new simple test", Oxford Bulletin of Economics and Statistics, 61(S1), pp.631~652 (1999)
  48. Magazzino, C., "Wagner versus Keynes: Public spending and national income in Italy", Journal of Policy Modeling, 34, pp.890~905 (2012)
  49. Optimal size of government and economic growth in EU-27, "Magazzino, C.", MPRA, ~, pp.MPRA Paper No. 26669 (2010)
  50. Miller, K.A., "An analysis of state and local public expenditure and output-maximizing spending optimums", Ph.D, pp.2008
  51. Mugaju, J.B., "The burden of education on economic development in Africa:An assessment", Transafrican Journal of History, 20, pp.110~124 (1991)
  52. Nelson, R., "Investment in humans, technological diffusion, and economic growth", American Economic Review, 61(1), pp.69~75 (1966)
  53. Neycheva, M., "Does public expenditure on education matter for growth in Europe? A Comparison between old EU member states and post-communist economies", Post-Communist Economies, 22(2), pp.141~164 (2010)
  54. Niskanen, W., "Bureaucracy and representative government" (1971), Aldine and Atherton
  55. Nonneman, W., "A further augmentation of the Solow model and the empirics of economic growth for OECD countries", Quarterly Journal of Economics, 111(3), pp.943~953 (1996)
  56. Organisation for Economic Cooperation and Development, "OECD government at a glance, 2011" (2011), OECD Publishing House
  57. Organisation for Economic Cooperation and Development, "Education at a glance, 2015" (2011), OECD Publishing House
  58. Park, H.M., "Practical guides to panel data modeling: A step by step analysis using Stata" (2011), International University of Japan
  59. General diagnostic tests for cross section dependence in panels, "Pesaran, M. H.", IZA, 1~39, pp.IZA Discussion Paper No. 1240 (2004)
  60. Pesaran, M.H., "A simple panel unit root test in the presence of cross section dependence", Journal of Applied Econometrics, 22(2), pp.265~312 (2007)
  61. Pritchett, L., "Where has all the education gone?", World Bank Economic Review, 15(3), pp.367~391 (2001)
  62. Qi, J., "Government education expenditure, third-party spillover effect and economic growth in China", Journal of Sustainable Development, 9(2), pp.145~152 (2016)
  63. Ram, R., "Government size and economic growth: A new framework and some evidence from cross-section and time-series data", The American Economic Review, 76(1), pp.191~203 (1986)
  64. Romer, P., "Endogenous technological change", Journal of Political Economy, 98(5), pp.S71~S102 (1990)
  65. Romero-Avila, D., "Public finances and long-term growth in Europe: Evidence from a panel data analysis", European Journal of Political Economy, 24(1), pp.172~191 (2008)
  66. Saez, M.P., "Government expenditure and economic growth in the European Union countries: new evidence", Bulletin of Geography. Socio-Economic Series, 36, pp.127~133 (2017)
  67. Schultz, T., "Investment in human capital", The American Economic Review, 51(1), pp.1~17 (1961)
  68. What is the optimal size of government in the US?, "cully, G.W.", National Centre for Policy Analysis, ~, pp.Policy Report No. 188 (1994)
  69. Su, X., "The allocation of public funds in a hierarchical educational system", Journal of Economic Dynamics and Control, 28, pp.2485~2510 (2004)
  70. Tanzi, V., "Reconsidering the fiscal role of government: The international perspective", American Economic Review, 87(2), pp.164~168 (1997)
  71. Tran-Nam, B., "Human capital and economic growth in an overlapping generations model", Journal of Economics, 61(2), pp.147~173 (1995)
  72. Vedder, R., "Government size and economic growth", US Congress, The Paper Prepared for the Joint Economic Committee (1998)
  73. Wu, S.-Y., "The impact of government expenditure on economic growth: How sensitive to the level of development?", Journal of Policy Modeling, 32(6), pp.804~817 (2010)
  74. United Nations, "World population prospects 2019. Volume I, Comprehensive tables" (2019), United Nations
  75. Yu, B., "Database user manual for statistics on public expenditures for economic development (SPEED)", International Food Policy Research Institute, ~ (2015)
  76. Zhang, R., "Optimal scale of the rural fiscal expenditure based on economic growth in China", Proceedings of the 15th International Conference on Management Science and Engineering (2008)

관련 논문AI추천

PUBLIC EDUCATION SPENDING AND ECONOMIC GROWTH: THE GOVERNANCE THRESHOLD EFFECTSALWA TRABELSI경제연구소 · Journal of Economic Development2018 · 제43권 제1호GOVERNMENT SPENDING ON TERTIARY EDUCATION, KNOWLEDGE, TECHNOLOGY, AND ECONOMIC GROWTHSiow Li Lai, TUCK CHEONG TANG경제연구소 · Journal of Economic Development2022 · 제47권 제4호EDUCATION, HEALTH AND ECONOMIC GROWTH IN AFRICAN COUNTRIESGILLES-ARMAND SOSSOU, HILAIRE HOUENINVO, JUDE EGGOH경제연구소 · Journal of Economic Development2015 · 제40권 제1호Composition of Expenditures and Economic Performance: Evidence from U.S. States박소영, 사용진한국공공관리학회 · 한국공공관리학보2016 · 제30권 제4호The composition of public expenditure and economic growth in India: Evidence from auto regressive distributed lag approachA K Giri, Geetilaxmi Mohapatra경제연구소 · Journal of Economic Research (JER)2016 · 제21권 제2호국가별 교육효율성 지수의 측정 및 활용방인성, 이종하, 황진영한국비교경제학회 · 비교경제연구2010 · 제17권 제2호

이 간행물의 다른 논문 (3건)

Has the RMB expanded the Efficient Frontier of the SDR?박춘원, Sheng Liupp. 105-130Revisiting the Prebisch-Singer hypothesis in the era of globalizationIsmay Jahan, S. M. Woahid Murad, Md. Sabbir Hossainpp. 131-158Cyclically adjusted price to earnings (CAPE) ratio and the federal funds rateMark E. Wohar, Eric Olson, Jack Dormineypp. 191-208
원문 보기