The Effect of Social Spending on Reducing Poverty

International Journal of Social Economics, Vol. 44, Issue 5, pp. 620-632, 2017

Posted: 17 Aug 2017

See all articles by Ferdi Celikay

Ferdi Celikay

Eskisehir Osmangazi University - Department of Public Finance

Erdal Gumus

Eskisehir Osmangazi University - Department of Public Finance

Date Written: 2017

Abstract

Purpose – The purpose of this paper is to provide new empirical evidence on the relationship between social expenditure and poverty in Turkey.

Design/methodology/approach – There are voluminous studies in the literature and many of which contain contradictory results. The authors use panel error correction models and employ Turkish statistical territorial units data (26 regions) covering the period 2004-2011 in the analysis.

Findings – The authors have found that in the short run, there is a negative relationship between social expenditure and poverty, as expected. In the long run, however, there exists a positive relation between them. The authors utilize expenditure on education as one component of social expenditure, and the authors obtain a negative relationship between education expenditure and poverty, both in the short run and in the long run.

Social implications – Poverty is an important social problem that more studies on this subject should examine various aspects and find policies to alleviate it.

Originality/value – Literature on poverty and social spending are growing and their results are contradictory. However, this paper clearly and significantly provides new empirical evidence on the effect of social spending on reducing poverty using Turkish data. This kind of study is hardly found for developing countries like Turkey. It contributes to the literature.

Keywords: Turkey, Poverty, Income Inequality, Cointegration Test, Educational Spending, Social Spending

JEL Classification: D63, D78, H52, H53, H55, I18, I3

Suggested Citation

Celikay, Ferdi and Gumus, Erdal, The Effect of Social Spending on Reducing Poverty (2017). International Journal of Social Economics, Vol. 44, Issue 5, pp. 620-632, 2017, Available at SSRN: https://ssrn.com/abstract=3004490

Ferdi Celikay

Eskisehir Osmangazi University - Department of Public Finance ( email )

Meselik Kampusu
Atatürk Bulv.
Osmangazi, Eskisehir 24680
Turkey

Erdal Gumus (Contact Author)

Eskisehir Osmangazi University - Department of Public Finance ( email )

Meselik Campus
Eskisehir, 26480
Turkey
+222 239 37 50/1751 (Phone)

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