IDEAS home Printed from https://ideas.repec.org/p/sek/iacpro/0101002.html
   My bibliography  Save this paper

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
    as

    Download full text from publisher

    File URL: https://iises.net/proceedings/9th-international-academic-conference-istanbul/table-of-content/detail?cid=1&iid=91&rid=1002
    File Function: First version, 2014
    Download Restriction: no

    References listed on IDEAS

    as
    1. Yakita, Akira, 2004. "Elasticity of substitution in public capital formation and economic growth," Journal of Macroeconomics, Elsevier, vol. 26(3), pages 391-408, September.
    2. Elsa V. Artadi & Xavier Sala-i-Martin, 2003. "The Economic Tragedy of the XXth Century: Growth in Africa," NBER Working Papers 9865, National Bureau of Economic Research, Inc.
    3. Dickey, David A & Fuller, Wayne A, 1981. "Likelihood Ratio Statistics for Autoregressive Time Series with a Unit Root," Econometrica, Econometric Society, vol. 49(4), pages 1057-1072, June.
    4. George Psacharopoulos & Harry Anthony Patrinos, 2004. "Returns to investment in education: a further update," Education Economics, Taylor & Francis Journals, vol. 12(2), pages 111-134.
    5. Vladimir Kuhl Teles & Joaquim Andrade, 2008. "Public investment in basic education and economic growth," Journal of Economic Studies, Emerald Group Publishing, vol. 35(4), pages 352-364, September.
    6. David E. Bloom & Jeffrey D. Sachs, 1998. "Geography, Demography, and Economic Growth in Africa," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 29(2), pages 207-296.
    7. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 407-437.
    8. Benhabib, Jess & Spiegel, Mark M., 1994. "The role of human capital in economic development evidence from aggregate cross-country data," Journal of Monetary Economics, Elsevier, vol. 34(2), pages 143-173, October.
    9. Glomm, Gerhard & Ravikumar, B., 1994. "Public investment in infrastructure in a simple growth model," Journal of Economic Dynamics and Control, Elsevier, vol. 18(6), pages 1173-1187, November.
    10. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 71-102, October.
    11. Jeffrey D. Sachs & Andrew Warner, 1995. "Economic Reform and the Process of Global Integration," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1, 25th A), pages 1-118.
    12. Dawood Mamoon & S. Mansoob Murshed, 2009. "Want economic growth with good quality institutions? Spend on education," Education Economics, Taylor & Francis Journals, vol. 17(4), pages 445-468.
    13. Baier, Scott L. & Glomm, Gerhard, 2001. "Long-run growth and welfare effects of public policies with distortionary taxation," Journal of Economic Dynamics and Control, Elsevier, vol. 25(12), pages 2007-2042, December.
    14. Norman Baldwin & Stephen Borrelli, 2008. "Education and economic growth in the United States: cross-national applications for an intra-national path analysis," Policy Sciences, Springer;Society of Policy Sciences, vol. 41(3), pages 183-204, September.
    15. Fukase, Emiko, 2010. "Revisiting Linkages between Openness, Education and Economic Growth: System GMM Approach," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 25, pages 193-222.
    16. Gyimah-Brempong, Kwabena & Wilson, Mark, 2004. "Health human capital and economic growth in Sub-Saharan African and OECD countries," The Quarterly Review of Economics and Finance, Elsevier, vol. 44(2), pages 296-320, May.
    17. Su, Xuejuan, 2004. "The allocation of public funds in a hierarchical educational system," Journal of Economic Dynamics and Control, Elsevier, vol. 28(12), pages 2485-2510, December.
    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. Kouton, Jeffrey, 2018. "Education expenditure and economic growth: Some empirical evidence from Côte d’Ivoire," MPRA Paper 88350, University Library of Munich, Germany.
    2. 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.

    More about this item

    Keywords

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

    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

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:sek:iacpro:0101002. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Klara Cermakova). General contact details of provider: https://iises.net/ .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.