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Globalization, Redistribution, and the Composition of Public Education Expenditures

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  • Thushyanthan Baskaran
  • Zohal Hessami

Abstract

We analyze whether globalization affects the composition of public expenditures for education by integrating arguments from the Heckscher-Ohlin and the tax competition literature into a common theoretical framework. The model suggests that with increasing global integration, developing countries have strong incentives to shift public education expenditures towards lower education. In industrialized countries, on the other hand, globalization has an ambiguous effect on the composition of public education expenditures. We test and confirm these hypotheses with data on 86 countries over the 1999-2006 period.

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Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2917.

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Date of creation: 2010
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Handle: RePEc:ces:ceswps:_2917

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Keywords: globalization; public education; composition of public spending;

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  1. Alexander Haupt & Eckhard Janeba, 2004. "Education, Redistribution, and the Threat of Brain Drain," NBER Working Papers 10618, National Bureau of Economic Research, Inc.
  2. Andersson, Fredrik & Konrad, Kai A., 2002. "Human capital investment and globalization in extortionary states," Discussion Papers, Research Unit: Market Processes and Governance FS IV 02-01, Social Science Research Center Berlin (WZB).
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  4. Shelton, Cameron A., 2007. "The size and composition of government expenditure," Journal of Public Economics, Elsevier, vol. 91(11-12), pages 2230-2260, December.
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  8. Dani Rodrik, 1997. "Has Globalization Gone Too Far?," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 57.
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  15. Axel Dreher, 2005. "Does Globalization Affect Growth? Evidence from a new Index of Globalization," TWI Research Paper Series 6, Thurgauer Wirtschaftsinstitut, Universität Konstanz.
  16. Benarroch, Michael & Pandey, Manish, 2008. "Trade openness and government size," Economics Letters, Elsevier, vol. 101(3), pages 157-159, December.
  17. Axel Dreher & Jan-Egbert Sturm & Heinrich Ursprung, 2006. "The Impact of Globalization on the Composition of Government Expenditures: Evidence from Panel Data," CESifo Working Paper Series 1755, CESifo Group Munich.
  18. Cameron A. Shelton, 2007. "The Size and Composition of Government Expenditure," Wesleyan Economics Working Papers 2007-002, Wesleyan University, Department of Economics.
  19. Axel Dreher, 2002. "Does Globalization Affect Growth?," Development and Comp Systems 0210004, EconWPA, revised 04 Feb 2003.
  20. Nicolas Couderc, 2007. "GRUBBS: Stata module to perform Grubbs' test for outliers," Statistical Software Components S456803, Boston College Department of Economics, revised 29 Jan 2007.
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