IDEAS home Printed from https://ideas.repec.org/p/ces/ceswps/_2917.html
   My bibliography  Save this paper

Globalization, Redistribution, and the Composition of Public Education Expenditures

Author

Listed:
  • Thushyanthan Baskaran
  • Zohal Hessami

Abstract

We analyze whether globalization affects the composition of public expenditures for education by integrating arguments from the Heckscher-Ohlin and the tax competition literature into a common theoretical framework. The model suggests that with increasing global integration, developing countries have strong incentives to shift public education expenditures towards lower education. In industrialized countries, on the other hand, globalization has an ambiguous effect on the composition of public education expenditures. We test and confirm these hypotheses with data on 86 countries over the 1999-2006 period.

Suggested Citation

  • Thushyanthan Baskaran & Zohal Hessami, 2010. "Globalization, Redistribution, and the Composition of Public Education Expenditures," CESifo Working Paper Series 2917, CESifo.
    • Handle: RePEc:ces:ceswps:_2917
    as

    Download full text from publisher

    File URL: https://www.ifo.de/DocDL/cesifo1_wp2917.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Alberto Alesina & Dani Rodrik, 1994. "Distributive Politics and Economic Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 109(2), pages 465-490.
    2. Devereux, Michael P. & Lockwood, Ben & Redoano, Michela, 2008. "Do countries compete over corporate tax rates?," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1210-1235, June.
    3. Hanushek, Eric A. & Leung, Charles Ka Yui & Yilmaz, Kuzey, 2003. "Redistribution through education and other transfer mechanisms," Journal of Monetary Economics, Elsevier, vol. 50(8), pages 1719-1750, November.
    4. Lee, Dwight R. & McKenzie, Richard B., 1989. "The International Political Economy of Declining Tax Rates," National Tax Journal, National Tax Association;National Tax Journal, vol. 42(1), pages 79-83, March.
    5. Axel Dreher & Jan-Egbert Sturm & Heinrich Ursprung, 2008. "The impact of globalization on the composition of government expenditures: Evidence from panel data," Public Choice, Springer, vol. 134(3), pages 263-292, March.
    6. Panu Poutvaara & Vesa Kanniainen, 2000. "Why Invest in Your Neighbor? Social Contract on Educational Investment," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 7(4), pages 547-562, August.
    7. Andersson, Fredrik & Konrad, Kai A., 2003. "Human capital investment and globalization in extortionary states," Journal of Public Economics, Elsevier, vol. 87(7-8), pages 1539-1555, August.
    8. Dani Rodrik, 1998. "Has Globalization Gone Too Far?," Challenge, Taylor & Francis Journals, vol. 41(2), pages 81-94, March.
    9. Nicolas Couderc, 2007. "GRUBBS: Stata module to perform Grubbs' test for outliers," Statistical Software Components S456803, Boston College Department of Economics, revised 29 Jan 2007.
    10. Shelton, Cameron A., 2007. "The size and composition of government expenditure," Journal of Public Economics, Elsevier, vol. 91(11-12), pages 2230-2260, December.
    11. Dani Rodrik, 1998. "Why Do More Open Economies Have Bigger Governments?," Journal of Political Economy, University of Chicago Press, vol. 106(5), pages 997-1032, October.
    12. Axel Dreher & Noel Gaston & Pim Martens, 2008. "Measuring Globalisation," Springer Books, Springer, number 978-0-387-74069-0, December.
    13. Lee, Dwight R. & McKenzie, Richard B., 1989. "The International Political Economy of Declining Tax Rates," National Tax Journal, National Tax Association, vol. 42(1), pages 79-83, March.
    14. Hans-Werner Sinn, 2005. "Migration and Social Replacement Incomes: How to Protect Low-Income Workers in the Industrialized Countries Against the Forces of Globalization and Market Integration," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 12(4), pages 375-393, August.
    15. Axel Dreher, 2002. "Does Globalization Affect Growth?," Development and Comp Systems 0210004, University Library of Munich, Germany, revised 16 Jun 2003.
    16. repec:oup:qjecon:v:109:y:1994:i:2:p:465-90 is not listed on IDEAS
    17. Alexander Haupt & Eckhard Janeba, 2009. "Education, redistribution and the threat of brain drain," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 16(1), pages 1-24, February.
    18. Slemrod, Joel, 2004. "Are corporate tax rates, or countries, converging?," Journal of Public Economics, Elsevier, vol. 88(6), pages 1169-1186, June.
    19. Axel Dreher, 2006. "Does globalization affect growth? Evidence from a new index of globalization," Applied Economics, Taylor & Francis Journals, vol. 38(10), pages 1091-1110.
    20. Benarroch, Michael & Pandey, Manish, 2008. "Trade openness and government size," Economics Letters, Elsevier, vol. 101(3), pages 157-159, December.
    21. Beck, Thorsten & Clarke, George & Groff, Alberto & Keefer, Philip & Walsh, Patrick, 2000. "New tools and new tests in comparative political economy - the database of political institutions," Policy Research Working Paper Series 2283, The World Bank.
    22. Rudra, Nita, 2002. "Globalization and the Decline of the Welfare State in Less-Developed Countries," International Organization, Cambridge University Press, vol. 56(2), pages 411-445, April.
    23. Hans‐Werner Sinn, 2004. "The New Systems Competition," Perspektiven der Wirtschaftspolitik, Verein für Socialpolitik, vol. 5(1), pages 23-38, February.
    24. Alesina, Alberto & Wacziarg, Romain, 1998. "Openness, country size and government," Journal of Public Economics, Elsevier, vol. 69(3), pages 305-321, September.
    25. Andersen, Torben M., 2005. "Migration, taxation and educational incentives," Economics Letters, Elsevier, vol. 87(3), pages 399-405, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zeynep Ozkok, 2017. "Financing Education in Europe: The Globalization Perspective," Economics and Politics, Wiley Blackwell, vol. 29(1), pages 69-90, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Stephanie Meinhard & Niklas Potrafke, 2012. "The Globalization–Welfare State Nexus Reconsidered," Review of International Economics, Wiley Blackwell, vol. 20(2), pages 271-287, May.
    2. Thushyanthan Baskaran & Zohal Hessami, 2011. "Public Education Spending in a Globalized World: Is there a Shift in Priorities Across Educational Stages?," Working Paper Series of the Department of Economics, University of Konstanz 2011-42, Department of Economics, University of Konstanz.
    3. Niklas Potrafke, 2012. "Political cycles and economic performance in OECD countries: empirical evidence from 1951–2006," Public Choice, Springer, vol. 150(1), pages 155-179, January.
    4. Vikas Dixit, 2014. "Relation between Trade Openness, Capital Openness and Government Size in India," Foreign Trade Review, , vol. 49(1), pages 1-29, February.
    5. Thushyanthan Baskaran & Zohal Hessami, 2012. "Public education spending in a globalized world:," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 19(5), pages 677-707, October.
    6. Helder Ferreira de Mendonça & Ana Jordânia de Oliveira, 2019. "Openness and government size: A new empirical assessment," Economics Bulletin, AccessEcon, vol. 39(2), pages 982-995.
    7. Ashraf, Ayesha, 2015. "The Effects of Greenfield FDI and Cross-Border M&As on Government Size," MPRA Paper 65061, University Library of Munich, Germany.
    8. Kevin Williams, 2021. "Does national income mediate the relationship between trade and government size?," Empirical Economics, Springer, vol. 61(6), pages 3029-3057, December.
    9. Florian Haelg & Niklas Potrafke & Jan-Egbert Sturm, 2022. "The determinants of social expenditures in OECD countries," Public Choice, Springer, vol. 193(3), pages 233-261, December.
    10. Zeynep Ozkok, 2017. "Financing Education in Europe: The Globalization Perspective," Economics and Politics, Wiley Blackwell, vol. 29(1), pages 69-90, March.
    11. Benarroch, Michael & Pandey, Manish, 2012. "The relationship between trade openness and government size: Does disaggregating government expenditure matter?," Journal of Macroeconomics, Elsevier, vol. 34(1), pages 239-252.
    12. Khalil Ahmad & Amjad Ali & Michael Yang, 2022. "The Effect Of Trade Liberalization On Expenditure Structure Of Pakistan," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 11(1), pages 73-84, March.
    13. Niklas Potrafke, 2009. "Did globalization restrict partisan politics? An empirical evaluation of social expenditures in a panel of OECD countries," Public Choice, Springer, vol. 140(1), pages 105-124, July.
    14. Niklas Potrafke, 2010. "Labor market deregulation and globalization: empirical evidence from OECD countries," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 146(3), pages 545-571, September.
    15. McCloud, Nadine & Delgado, Michael S. & Holmes, Chanit'a, 2018. "Does a stronger system of law and order constrain the effects of foreign direct investment on government size?," European Journal of Political Economy, Elsevier, vol. 55(C), pages 258-283.
    16. Bergh, Andreas & Nilsson, Therese, 2009. "Good for living? On the relation between globalization and life expectancy," Working Papers 2009:9, Lund University, Department of Economics.
    17. Edward Anderson & Samuel Obeng, 2021. "Globalisation and government spending: Evidence for the ‘hyper‐globalisation’ of the 1990s and 2000s," The World Economy, Wiley Blackwell, vol. 44(5), pages 1144-1176, May.
    18. Hrushikesh Mallick, 2024. "Does onslaught of globalisation induce pro-efficient government expenditures in a large transitioning economy? Empirical evidence from India," Economic Change and Restructuring, Springer, vol. 57(2), pages 1-46, April.
    19. Jha, Priyaranjan & Gozgor, Giray, 2019. "Globalization and taxation: Theory and evidence," European Journal of Political Economy, Elsevier, vol. 59(C), pages 296-315.
    20. Tushar Bharati & Mohammad Farhad & Michael Jetter, 2023. "On the relationship between trade openness and government size," The World Economy, Wiley Blackwell, vol. 46(7), pages 2102-2133, July.

    More about this item

    Keywords

    globalization; public education; composition of public spending;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • H42 - Public Economics - - Publicly Provided Goods - - - Publicly Provided Private Goods
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ces:ceswps:_2917. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Klaus Wohlrabe (email available below). General contact details of provider: https://edirc.repec.org/data/cesifde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.