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Healthy, educated and wealthy: A primer on the impact of public and private welfare expenditures on economic growth

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  • Beraldo, Sergio
  • Montolio, Daniel
  • Turati, Gilberto

Abstract

In this paper, we provide first evidence of the impact of public and private expenditures in health and education on economic growth, via their influence on people's health, skills and knowledge. We consider a growth accounting framework in order to test whether countries that devote a larger amount of resources to the consumption of health and educational services experience higher growth rates. We also test whether the effects on economic growth of public expenditure in health and education differ from those of private expenditure. Our empirical analysis is based on a panel of 19 OECD countries observed between 1971 and 1998. The results are consistent with the hypothesis that health and education expenditure affects positively growth. The estimated impact is stronger for health than for education. More importantly, we find some evidence that public expenditure influences GDP growth more than private expenditure.

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Bibliographic Info

Article provided by Elsevier in its journal The Journal of Socio-Economics.

Volume (Year): 38 (2009)
Issue (Month): 6 (December)
Pages: 946-956

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Handle: RePEc:eee:soceco:v:38:y:2009:i:6:p:946-956

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Web page: http://www.elsevier.com/locate/inca/620175

Related research

Keywords: Health Education Public and private expenditure Economic growth;

References

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Cited by:
  1. Fatulescu, Puiu, 2011. "Cheltuielile Publice în domeniul Sănătății- principalii factori care le influențează
    [Public Health Systems Expenditures and the main factors that drives them]    ," MPRA Paper 37191, University Library of Munich, Germany.
  2. Ding, Hong, 2012. "Economic growth and welfare state: a debate of econometrics," MPRA Paper 39685, University Library of Munich, Germany.

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