IDEAS home Printed from https://ideas.repec.org/p/zbw/bamber/98.html
   My bibliography  Save this paper

Impact of public funding of education on economic growth in Macedonia

Author

Listed:
  • Bexheti, Abdylmenaf
  • Mustafi, Besime

Abstract

The main aim of this study is to investigate the relationship between public spending on education after the process of decentralization and economic growth in Macedonia as low income state. This paper do not have intention to make a picture of education system in Macedonia, how it functions or if education is open to all, but has the aim to measure the public spending on education as a determinant that has impact on economic growth even positive or negative. This paper raise the following important question: 'do all measures of public spending on education promote economic growth?' As a lack of data in developing countries like is Macedonia the specification of empirical models to test the causal effect on public spending on education and growth is paradox and this explain why the road through which public education expenditure affects economic growth is not yet well understood. The inter-relationships between government expenditure and education quality should be taken into account when formulating education policy to promote economic growth (Corray, 2000). The channels by which education can promote growth maybe do not lie to quantity of public spending but on quality of the policy that means where youth end after their education. We investigate the link between public spending on education and economic growth in Macedonia using Logarithmic Multiple Regression Model. We came in conclusion that the model is significant. The result shows negative effect on public spending on education and economic growth in the case of Macedonia. The results also raise another statement 'what exactly are the highly educated workers doing together (that is so sensitive to their being highly educated) if it does not involve things changing at the margin?' (Aghion, et.al 2009). It ends with some key conclusions and recommendations that there has to be founded another channels to produce quality education - skilled labor by which will rise the productivity and economic growth.

Suggested Citation

  • Bexheti, Abdylmenaf & Mustafi, Besime, 2015. "Impact of public funding of education on economic growth in Macedonia," BERG Working Paper Series 98, Bamberg University, Bamberg Economic Research Group.
  • Handle: RePEc:zbw:bamber:98
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/107594/1/818765119.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Witte, Björn-Christopher, 2011. "Removing systematic patterns in returns in a financial market model by artificially intelligent traders," BERG Working Paper Series 82, Bamberg University, Bamberg Economic Research Group.
    2. Pfeffer, Annamaria, 2010. "Staatliche Zinssubvention und Auslandsverschuldung: Eine Mittelwert-Varianz-Analyse am Beispiel Ungarn," BERG Working Paper Series 72, Bamberg University, Bamberg Economic Research Group.
    3. Bexheti, Abdulmenaf, 2010. "Anti-crisis measures in the republic of Macedonia and their effects: Are they sufficient?," BERG Working Paper Series 70, Bamberg University, Bamberg Economic Research Group.
    4. Devarajan, Shantayanan & Swaroop, Vinaya & Heng-fu, Zou, 1996. "The composition of public expenditure and economic growth," Journal of Monetary Economics, Elsevier, vol. 37(2-3), pages 313-344, April.
    5. Tuinstra, Jan & Wegener, Michael & Westerhoff, Frank, 2013. "Positive welfare effects of trade barriers in a dynamic equilibrium model," BERG Working Paper Series 91, Bamberg University, Bamberg Economic Research Group.
    6. Cooray, Arusha, 2010. "The Role of Education in Economic Growth," Economics Working Papers wp10-14, School of Economics, University of Wollongong, NSW, Australia.
    7. Tramontana, Fabio & Westerhoff, Frank & Gardini, Laura, 2013. "The bull and bear market model of Huang and Day: Some extensions and new results," Journal of Economic Dynamics and Control, Elsevier, vol. 37(11), pages 2351-2370.
    8. Philipp Mundt & Simone Alfarano & Mishael Milakovic, 2016. "Gibrat’s Law Redux: think profitability instead of growth," Industrial and Corporate Change, Oxford University Press, vol. 25(4), pages 549-571.
    9. Nusser, Michael, 1998. "The implications of innovations and wage structure rigidity on economic growth and unemployment: A Schumpeterian approach to endogenous growth theory," BERG Working Paper Series 26, Bamberg University, Bamberg Economic Research Group.
    10. Bernd Hayo & Matthias Wrede, 2004. "Fiscal equalisation: Principles and an application to the European Union," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 23(3), pages 333-348, December.
    11. Westerhoff, Frank, 2009. "A simple agent-based financial market model: Direct interactions and comparisons of trading profits," BERG Working Paper Series 61, Bamberg University, Bamberg Economic Research Group.
    12. Wagener, Sibylle, 2003. "Fiskalischer Föderalismus: Theoretische Grundlagen und Studie Ungarns," BERG Working Paper Series 46, Bamberg University, Bamberg Economic Research Group.
    13. Lines Marji & Westerhoff Frank, 2012. "Effects of Inflation Expectations on Macroeconomic Dynamics: Extrapolative Versus Regressive Expectations," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 16(4), pages 1-30, October.
    14. Wunder, Christoph & Heineck, Guido, 2013. "Working time preferences, hours mismatch and well-being of couples: Are there spillovers?," Labour Economics, Elsevier, vol. 24(C), pages 244-252.
    15. Dieci, Roberto & Westerhoff, Frank, 2011. "On the inherent instability of international financial markets: Natural nonlinear interactions between stock and foreign exchange markets," BERG Working Paper Series 79, Bamberg University, Bamberg Economic Research Group.
    16. Treier, Volker, 1999. "Unemployment in reforming countries: Causes, fiscal impacts and the success of transformation," BERG Working Paper Series 29, Bamberg University, Bamberg Economic Research Group.
    17. Kurt A. Hafner, 2015. "Tax Competition and Economic Integration," Review of Development Economics, Wiley Blackwell, vol. 19(1), pages 45-61, February.
    18. Herber, Stefanie P., 2015. "The role of information in the application for merit-based scholarships: Evidence from a randomized field experiment," BERG Working Paper Series 95, Bamberg University, Bamberg Economic Research Group.
    19. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    20. Kola, Tonin & Liko, Elida, 2008. "An empirical assessment of alternative exchange rate regimes in medium term in Albania," BERG Working Paper Series 58, Bamberg University, Bamberg Economic Research Group.
    21. Franke, Reiner & Westerhoff, Frank, 2012. "Structural stochastic volatility in asset pricing dynamics: Estimation and model contest," Journal of Economic Dynamics and Control, Elsevier, vol. 36(8), pages 1193-1211.
    22. Westerhoff, Frank & Franke, Reiner, 2012. "Agent-based models for economic policy design: Two illustrative examples," BERG Working Paper Series 88, Bamberg University, Bamberg Economic Research Group.
    23. Maußner, Alfred, 1998. "Außengeld in berechenbaren Konjunkturmodellen: Modellstrukturen und numerische Eigenschaften," BERG Working Paper Series 25, Bamberg University, Bamberg Economic Research Group.
    24. Herber, Stefanie, 2015. "The Role of Information in the Application for Merit-Based Scholarships: Evidence from a Randomized Field Experiment," Annual Conference 2015 (Muenster): Economic Development - Theory and Policy 113058, Verein für Socialpolitik / German Economic Association.
    25. Haensgen, Tineke, 2002. "Das Kyoto Protokoll: Eine ökonomische Analyse unter besonderer Berücksichtigung der flexiblen Mechanismen," BERG Working Paper Series 40, Bamberg University, Bamberg Economic Research Group.
    26. Bersch, Julia, 2004. "AK-Modell mit Staatsverschuldung und fester Defizitquote," BERG Working Paper Series 48, Bamberg University, Bamberg Economic Research Group.
    27. Halicioglu Ferda, 2003. "Testing Wagner's Law for Turkey, 1960-2000," Review of Middle East Economics and Finance, De Gruyter, vol. 1(2), pages 31-42, August.
    28. Wrede, Matthias, 1999. "A note on reliefs for traveling expenses to work," BERG Working Paper Series 30, Bamberg University, Bamberg Economic Research Group.
    29. Witte, Björn-Christopher, 2009. "Temporal information gaps and market efficiency: A dynamic behavioral analysis," BERG Working Paper Series 64, Bamberg University, Bamberg Economic Research Group.
    30. Aßmann, Christian, 2008. "Assessing the Effect of Current Account and Currency Crises on Economic Growth," Economics Working Papers 2008-01, Christian-Albrechts-University of Kiel, Department of Economics.
    31. Roberto Dieci & Frank Westerhoff, 2012. "A simple model of a speculative housing market," Journal of Evolutionary Economics, Springer, vol. 22(2), pages 303-329, April.
    32. Guido Heineck, 2014. "Love Thy Neighbor: Religion and Prosocial Behavior," SOEPpapers on Multidisciplinary Panel Data Research 704, DIW Berlin, The German Socio-Economic Panel (SOEP).
    33. Carsten Eckel, 2009. "International Trade and Retailing," CESifo Working Paper Series 2597, CESifo Group Munich.
    34. Antoni, Manfred & Heineck, Guido, 2012. "Do literacy and numeracy pay off? On the relationship between basic skills and earnings," BERG Working Paper Series 86, Bamberg University, Bamberg Economic Research Group.
    35. Wenzel, Heinz-Dieter (Ed.), 2007. "Der Kaspische Raum: Ausgewählte Themen zu Politik und Wirtschaft," BERG Working Paper Series 57, Bamberg University, Bamberg Economic Research Group.
    36. Alfarano Simone & Milakovic Mishael, 2012. "Identification of Interaction Effects in Survey Expectations: A Cautionary Note," Studies in Nonlinear Dynamics & Econometrics, De Gruyter, vol. 16(4), pages 1-23, October.
    37. Malaj, Arben & Mema, Fatmir & Hida, Sybi, 2005. "Albania, financial management in the education system: Higher education," BERG Working Paper Series 54, Bamberg University, Bamberg Economic Research Group.
    38. Jenei, György, 2009. "A post-accession crisis? Political developments and public sector modernization in Hungary," BERG Working Paper Series 67, Bamberg University, Bamberg Economic Research Group.
    39. Wrede, Matthias, 1999. "Mobility and reliefs for traveling expenses to work," BERG Working Paper Series 33, Bamberg University, Bamberg Economic Research Group.
    40. Fan, Shenggen & Rao, Neetha, 2003. "Public spending in developing countries: trends, determination, and impact," EPTD discussion papers 99, International Food Policy Research Institute (IFPRI).
    41. Malaj, Arben & Mema, Fatmir, 2003. "Strategic privatisation: Its achievements and challenges," BERG Working Paper Series 41, Bamberg University, Bamberg Economic Research Group.
    42. Thiel, Elke, 2004. "European Integration of Albania : Economic Aspects," BERG Working Paper Series 49, Bamberg University, Bamberg Economic Research Group.
    43. Witte, Björn-Christopher, 2011. "Fund managers - why the best might be the worst: On the evolutionary vigor of risk-seeking behavior," BERG Working Paper Series 81, Bamberg University, Bamberg Economic Research Group.
    44. Gaber, Stevan, 2010. "Economic implications from deficit finance," BERG Working Paper Series 69, Bamberg University, Bamberg Economic Research Group.
    45. Kremer, Jana, 1999. "Arbeitslosigkeit und Steuerpolitik," BERG Working Paper Series 32, Bamberg University, Bamberg Economic Research Group.
    46. Schwarze, Nicolas Henrik, 2003. "Ein Modell für Finanzkrisen bei Moral Hazard und Überinvestition," BERG Working Paper Series 44, Bamberg University, Bamberg Economic Research Group.
    47. Nusser, Michael, 1999. "The implications of wage structure rigidity on human capital accumulation, economic growth and unemployment: A Schumpeterian approach to endogenous growth theory," BERG Working Paper Series 28, Bamberg University, Bamberg Economic Research Group.
    48. Michael Chletsos & Christos Kollias, 1997. "Testing Wagner's law using disaggregated public expenditure data in the case of Greece: 1958-93," Applied Economics, Taylor & Francis Journals, vol. 29(3), pages 371-377.
    49. Wrede, Matthias, 1998. "Pareto efficiency of the pay-as-you-go pension system in a three-period-OLG model," BERG Working Paper Series 27, Bamberg University, Bamberg Economic Research Group.
    50. Kalusche, Johannes, 2010. "Die Auswirkungen der Steuer- und Sozialreformen der Jahre 1999 - 2005 auf die automatischen Stabilisatoren Deutschlands," BERG Working Paper Series 76, Bamberg University, Bamberg Economic Research Group.
    51. Meyer, Dietmar & Shera, Adela, 2015. "Remittances' impact on the labor supply and on the deficit of current account," BERG Working Paper Series 97, Bamberg University, Bamberg Economic Research Group.
    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. Schmitt, Noemi & Tuinstra, Jan & Westerhoff, Frank, 2017. "Side effects of nonlinear profit taxes in an evolutionary market entry model: Abrupt changes, coexisting attractors and hysteresis problems," Journal of Economic Behavior & Organization, Elsevier, vol. 135(C), pages 15-38.
    2. Sahm, Marco, 2017. "Are sequential round-robin tournaments discriminatory?," BERG Working Paper Series 121, Bamberg University, Bamberg Economic Research Group.
    3. Lena Dräger & Christian R. Proaño, 2015. "Cross-Border Banking and Business Cycles in Asymmetric Currency Unions," Macroeconomics and Finance Series 201501, University of Hamburg, Department of Socioeconomics.
    4. March, Christoph & Sahm, Marco, 2017. "Asymmetric discouragement in asymmetric contests," Economics Letters, Elsevier, vol. 151(C), pages 23-27.
    5. Fatoke-Dato, Mafaïzath A., 2015. "Impact of income shock on children's schooling and labor in a West African country," BERG Working Paper Series 102, Bamberg University, Bamberg Economic Research Group.
    6. Herold, Florian & Kuzmics, Christoph, 2016. "The evolution of taking roles," BERG Working Paper Series 115, Bamberg University, Bamberg Economic Research Group.
    7. Proaño, Christian R. & Lojak, Benjamin, 2015. "Debt stabilization and macroeconomic volatility in monetary unions under heterogeneous sovereign risk perceptions," BERG Working Paper Series 106, Bamberg University, Bamberg Economic Research Group.
    8. Fatoke-Dato, Mafaïzath A., 2015. "Impact of an educational demand-and-supply policy on girls' education in West Africa: Heterogeneity in income, school environment and ethnicity," BERG Working Paper Series 101, Bamberg University, Bamberg Economic Research Group.
    9. Sahm, Marco, 2016. "Advance-purchase financing of projects with few buyers," BERG Working Paper Series 118, Bamberg University, Bamberg Economic Research Group.
    10. Sahm, Marco, 2017. "Risk aversion and prudence in contests," BERG Working Paper Series 120, Bamberg University, Bamberg Economic Research Group.
    11. repec:taf:quantf:v:17:y:2017:i:8:p:1187-1203 is not listed on IDEAS
    12. Schmitt, Noemi & Westerhoff, Frank, 2015. "Evolutionary competition and profit taxes: market stability versus tax burden," BERG Working Paper Series 104, Bamberg University, Bamberg Economic Research Group.
    13. March, Christoph & Sahm, Marco, 2017. "Contests as selection mechanisms: The impact of risk aversion," BERG Working Paper Series 127, Bamberg University, Bamberg Economic Research Group.
    14. Noemi Schmitt & Frank Westerhoff, 2017. "Herding behaviour and volatility clustering in financial markets," Quantitative Finance, Taylor & Francis Journals, vol. 17(8), pages 1187-1203, August.

    More about this item

    Keywords

    public expenditures; education; economic growth; real GDP; public investment; skilled labor;

    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:zbw:bamber:98. 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: (ZBW - German National Library of Economics). General contact details of provider: http://edirc.repec.org/data/bebamde.html .

    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.