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Public spending on education and Economic Growth in Algeria: Causality Test

Author

Listed:
  • Yousra Mekdad

    (University of Jijel)

  • Aziz Dahmani

    (University of bechar)

  • Monir Louadj

    (University of jijel)

Abstract

In this article, we seek to study the relationship between education and economic growth.For this purpose, we studied multipleentrances(dimension ) information relating education and Economic Growth on theoretical and empirical background in the first, as the second part of study to analysis and examine the effect of Public spendingon education on economic growth in Algeria over the period 1974-2012. with the use of endogenous growth model. In this model, gross domestic product(GDP) is based on the Cobb Douglas form which is the function was adoptedwith five variables: Real Gross National Product (GDP), Capital (K), Labor (L), Expenditure on Education (SEDU). Two unit root tests (Philips-Perron Test) have been employed to test the integration order of the variables.study uses Ordinary Least Squares (OLS) and Johansen Co-integration test and Causality Test is as analytical techniques for this purpose. The empirical results support the main hypothesis of this study that Public spending on education affects positively economic growth in Algeria. Even though that the most important effect on economic growth is for education, the other three explanatory variables affect also, positively, the economic growth; yet their effect is relatively less important than the effect of education.

Suggested Citation

  • Yousra Mekdad & Aziz Dahmani & Monir Louadj, 2014. "Public spending on education and Economic Growth in Algeria: Causality Test," Proceedings of International Academic Conferences 0101002, International Institute of Social and Economic Sciences.
    • Handle: RePEc:sek:iacpro:0101002
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    Cited by:

    1. Kouton, Jeffrey, 2018. "Education expenditure and economic growth: Some empirical evidence from Côte d’Ivoire," MPRA Paper 88350, University Library of Munich, Germany.
    2. Priya Ranjan & Prasant Kumar Panda, 2022. "Pattern of Development Spending and Its Impact on Human Development Index and Gross State Domestic Product in Low-income States in India," Journal of Development Policy and Practice, , vol. 7(1), pages 71-95, January.
    3. Sunde, Tafirenyika, 2017. "Education Expenditure and Economic Growth in Mauritius: An Application of the Bounds Testing Approach," MPRA Paper 86667, University Library of Munich, Germany.
    4. Amina Amirat & Makram Zaidi, 2020. "Estimating GDP Growth in Saudi Arabia Under the Government’s Vision 2030: a Knowledge-based Economy Approach," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 11(3), pages 1145-1170, September.
    5. Christopher P. P. Shafuda & Utpal Kumar De, 2020. "Government expenditure on human capital and growth in Namibia: a time series analysis," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 9(1), pages 1-14, December.
    6. Omoshoro-Jones, Oyeyinka Sunday, 2016. "A Cointegration and Causality Test on Government Expenditure –Economic Growth Nexus: Empirical Evidence from a South African Province," MPRA Paper 102085, University Library of Munich, Germany, revised 17 Oct 2017.
    7. Olawunmi Omitogun & Farouq Adekunle Akanni & Adedayo Emmanuel Longe & longeemmanuel28@gmail.com, 2019. "Disaggregated Government Expenditure and Education Enrolment in Nigeria," Business & Management Compass, University of Economics Varna, issue 4, pages 309-326.

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    More about this item

    Keywords

    Economic Growth; Public spending on education; Co-integration Analysis; Causality Tests.;
    All these keywords.

    JEL classification:

    • A10 - General Economics and Teaching - - General Economics - - - General
    • A20 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - General
    • C59 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Other

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