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Does the government expenditure on education and family income boost educational expansion?: Lesson from panel FMOLS

Author

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  • Khusaini Khusaini

    (Syekh-Yusuf Islamic University, Indonesia)

  • Heni Cahya Ramdani

    (Syekh-Yusuf Islamic University, Indonesia)

  • Estu Niana Syamiya

    (Syekh-Yusuf Islamic University, Indonesia)

  • Iis Aisyah

    (Siliwangi University, Indonesia)

Abstract

One of the problems of education development in Indonesia is the slow distribution of education, especially in the regions. Understanding the relationship between government spending on education and family income helps improve education equity in the region and formulate appropriate education policies. The study examines the effects of government expenditure in education, family income, poverty, and control variables on the primary, junior, senior secondary of net enrollment ratio and means years of schooling. This study utilized secondary data from regencies/municipalities in Banten Province over the period from 2000 to 2019. The panel FMOLS model found that family income contributed significantly to increasing the education expansion as measured by net enrollment rate in primary, junior, senior high schools and mean years of schooling for all models. Poverty only affected the net enrollment rate for junior high school, senior high school, and mean years of schooling in the long term. However, the findings on the impact of education spending on educational expansion are ambiguous. Furthermore, it depended on the method utilized. This research contributes to providing local government policy input to improve education services through increasing family income, reducing poverty, and providing educational opportunities for the school-age population to obtain equal education services.

Suggested Citation

  • Khusaini Khusaini & Heni Cahya Ramdani & Estu Niana Syamiya & Iis Aisyah, 2022. "Does the government expenditure on education and family income boost educational expansion?: Lesson from panel FMOLS," Review of Applied Socio-Economic Research, Pro Global Science Association, vol. 24(2), pages 89-105, December.
  • Handle: RePEc:rse:wpaper:v:24:y:2022:i:2:p:89-105
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    More about this item

    Keywords

    educational expansion; government spending; mean years of schooling; school participation;
    All these keywords.

    JEL classification:

    • H76 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Other Expenditure Categories
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development

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