The Impact of Public Education Expenditure on Human Capital, Growth, and Poverty in Tanzania and Zambia A General Equilibrium Approach

37 Pages Posted: 15 Feb 2006

See all articles by Hong-Sang Jung

Hong-Sang Jung

International Monetary Fund (IMF)

Erik Thorbecke

Cornell University

Date Written: August 2001

Abstract

The impact of public education expenditure on human capital, the supply of different labor skills, and its macroeconomic and distributional consequences is appraised within a multisector CGE model. The model is applied to and calibrated for two Heavily Indebted Poor Countries (HIPCs), Tanzania and Zambia. The simulation results suggest that education expenditure can raise economic growth. However, to maximize benefits from education expenditure, a sufficiently high level of physical investment is needed, as are measures that improve the match between the pattern of educational output and the structure of effective demand for labor. An important result of the simulation experiments is that a well-targeted pattern of education expenditure can be effective for poverty alleviation.

Keywords: Public expenditure CGE education poverty Tanzania Zambia

JEL Classification: H5 I2

Suggested Citation

Jung, Hong-Sang and Thorbecke, Erik, The Impact of Public Education Expenditure on Human Capital, Growth, and Poverty in Tanzania and Zambia A General Equilibrium Approach (August 2001). IMF Working Paper, Vol. , pp. 1-37, 2001. Available at SSRN: https://ssrn.com/abstract=879682

Hong-Sang Jung (Contact Author)

International Monetary Fund (IMF)

700 19th Street NW
Washington, DC 20431
United States

Erik Thorbecke

Cornell University ( email )

Ithaca, NY 14853
United States

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