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An Empirical Analysis of the Impact of Public Expenditures on Education and Health on Poverty in Indian States

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  • Raghbendra Jha

    ()

  • Bagala Biswal
  • Urvashi D. Biswal

Abstract

The principal objective of this study is to test whether public expenditures on education, health and other development activities have been effective in reducing poverty in India. To ensure sensitivity and robustness of the results, three different measures of poverty belonging to the Foster-Greer-Thorbecke group of poverty measures are used. We consider various types of education expenditures, viz., government expenditures on elementary, secondary, higher/university and "other" levels. Data for fourteen Indian states from 13th to 53rd rounds of National Sample Survey of India are used for estimating poverty. Using unbalanced panel data techniques, we test Fixed effects, Random effects and OLS models, and concludes that education, health and development expenditures help reduce poverty. In particular, expenditure on higher, university, technical, adult and vocational educations as opposed to elementary and secondary education is more effective in poverty reduction. Several policy conclusions are advanced.

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Bibliographic Info

Paper provided by The Australian National University, Australia South Asia Research Centre in its series ASARC Working Papers with number 2001-05.

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Length: 30
Date of creation: 2001
Date of revision:
Handle: RePEc:pas:asarcc:2001-05

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Keywords: India; Poverty Indices; Public Expenditures on Education and Health; Fixed and Random Effect Models; Panel Data;

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Cited by:
  1. Bhattacharya, Haimanti & Innes, Robert, 2006. "Is There a Nexus between Poverty and Environment in Rural India?," 2006 Annual meeting, July 23-26, Long Beach, CA 21201, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  2. Stefano Paternostro & Anand Rajaram & Erwin R. Tiongson, 2007. "How Does the Composition of Public Spending Matter?," Oxford Development Studies, Taylor & Francis Journals, vol. 35(1), pages 47-82.

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