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Public investment in basic education and economic growth

Author

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  • Vladimir Kuhl Teles
  • Joaquim Andrade

Abstract

Purpose - The main purpose of this paper is to visualize the relation between government spending on basic education and the human capital accumulation process, observing the impacts of this spending on individual investments in higher education, and on economic growth. Design/methodology/approach - The paper uses an overlapping‐generations model where the government tax the adult generation and spent it in basic education of the next generations. Findings - It was demonstrated that the magnitude of the marginal effect of government spending in basic education on growth crucially depends on public budget constrains. Originality/value - The paper explains why some countries with a lot of public investment in basic education growth at low rates. In that sense if a country has only a lot of public investment in basic education without investment in higher education it may growth at low rates because the taxation can cause distortions in the agents incentives to invest in higher education.

Suggested Citation

  • Vladimir Kuhl Teles & Joaquim Andrade, 2008. "Public investment in basic education and economic growth," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 35(4), pages 352-364, September.
    • Handle: RePEc:eme:jespps:v:35:y:2008:i:4:p:352-364
    DOI: 10.1108/01443580810895635
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    Citations

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    Cited by:

    1. Bashir, Saima & Herath, Janaranjana & Gebremedhin, Tesfa G., 2012. "An Empirical Analysis of Higher Education and Economic Growth in West Virginia," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 124829, Agricultural and Applied Economics Association.
    2. 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.
    3. Burcu Kiran, 2014. "Testing the impact of educational expenditures on economic growth: new evidence from Latin American countries," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(3), pages 1181-1190, May.
    4. Zhehao Wang, 2025. "Health and education investments in human capital, the impacts on fertility and economic growth," Discussion Papers in Economics and Business 25-14, Osaka University, Graduate School of Economics.
    5. Aldieri, Luigi & Kotsemir, Maxim & Vinci, Concetto Paolo, 2018. "The impact of research collaboration on academic performance: An empirical analysis for some European countries," Socio-Economic Planning Sciences, Elsevier, vol. 62(C), pages 13-30.
    6. Yang, Yi & Shen, Liyin & Sang, Meiyue & Ding, Xinyi, 2025. "The impact of digitalization on urban sustainable development – An economic perspective," Technological Forecasting and Social Change, Elsevier, vol. 212(C).
    7. Yazid Dissou & Selma Didic, 2012. "Government spending on education, human capital accumulation, taxes and growth: a multisector dynamic general equilibrium analysis," EcoMod2012 4540, EcoMod.
    8. Li, Chenhui & Lian, Xubei & Zhang, Zhi, 2018. "Public education expenditure, institution development, and regional innovations: An empirical evidence from China," Economics Discussion Papers 2018-23, Kiel Institute for the World Economy.
    9. Silu Chen & Liang Peng, 2025. "Road to Resilient Cities: The Power of Education Investment from China’s Cities," Sustainability, MDPI, vol. 17(7), pages 1-24, April.
    10. Adachi, Yoshimi & Kitamura, Tomoki, 2021. "Impact of the Financial Support Program for High School Students in Japan," MPRA Paper 106769, University Library of Munich, Germany.

    More about this item

    Keywords

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    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O23 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Fiscal and Monetary Policy in Development
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy

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