The relationship between public education expenditure and economic growth: The case of India
AbstractThe paper reviews the theoretical and the empirical case for public investment in education in India. Though the theoretical literature provides a backing for such a policy, the empirical literature fails to find a robust relation between education expenditure and growth. Expenditure on education is a necessary but not a sufficient condition for growth. It seems that the effectiveness of education expenditure depends on the institutional and labour market characteristics of the economy. The effectiveness of education investments also depends on other factors such as trade openness. Due to these aforesaid factors, we argue that the empirical relation between education expenditure and growth for India has been inconsistent.
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Bibliographic InfoPaper provided by Economic Studies, University of Dundee in its series Dundee Discussion Papers in Economics with number 273.
Length: 14 pages
Date of creation: Dec 2012
Date of revision:
Public education expenditure; economic growth; trade openness; India;
Find related papers by JEL classification:
- E60 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General
- E62 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Fiscal Policy
- H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
- I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-01-07 (All new papers)
- NEP-CWA-2013-01-07 (Central & Western Asia)
- NEP-EDU-2013-01-07 (Education)
- NEP-FDG-2013-01-07 (Financial Development & Growth)
- NEP-MAC-2013-01-07 (Macroeconomics)
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