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Globalization and the Composition of Public Education Expenditures: A Dynamic Panel Analysis

  • Thushyanthan Baskaran


    (Gothenburg Centre of Globalization and Development, Department of Economics, University of Gothenburg, Sweden)

  • Zohal Hessami


    (Department of Economics, University of Konstanz, Germany)

This paper studies the relationship between globalization and the composition of public education expenditures. The theoretical model is embedded in a median voter setting and is based on the assumption that globalization leads to lower tax revenues as well as an increase in the relative wage of high-skilled workers. Overall, the theoretical discussion suggests that globalization induces a shift from primary to tertiary education expenditures, which is backed up by empirical evidence from dynamic panel estimations for 121 countries over the 1992 - 2006 period. A possible implication of the shift in educational priorities towards higher education is an increase in income inequality

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Paper provided by Department of Economics, University of Konstanz in its series Working Paper Series of the Department of Economics, University of Konstanz with number 2010-03.

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Length: 34 pages
Date of creation: 28 Sep 2010
Date of revision:
Handle: RePEc:knz:dpteco:1003
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