Nexus between Government Expenditure on Education and Economic Growth: Empirical Evidences from India
Romanian Journal for Multidimensional Education, Vol. 3, No. 6, pp. 73-85, April 2011
13 Pages Posted: 16 Sep 2010 Last revised: 2 May 2011
Date Written: September 15, 2010
Macroeconomists across the world focus on the long-term growth of economies and its dynamic relationship with aspects such as human capital, monetary and other government policies. This paper examines the causation between government expenditure on education and economic growth. Education is a major aspect of human capital and investment in education certainly has a significant impact of social development and subsequently on overall economic growth of any economy in general and emerging economies in particular. Using the time-series data of last above 50 years on government expenditure on education and rate of economic growth in India, the paper makes an attempt to evaluate the impact of one factor on the other. Since the study is under process, final findings are yet to be interpreted. Preliminary findings of this study suggest a bidirectional relation between government expenditure on education and economic growth.
Keywords: Public finance, Macroeconomics, GDP, Human capital, Education
JEL Classification: B22, C50, P35
Suggested Citation: Suggested Citation