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Public Education Spending and Economic Growth: The Governance Threshold Effect

Salwa Trabelsi ()
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Salwa Trabelsi: ESSEC, University of Tunis

Journal of Economic Development, 2018, vol. 43, issue 1, 101-124

Abstract: This paper aims to give reason to the mixed result between the public education spending and growth found largely by the empirical works and to confirm the nonlinear character of this relationship. Using cross countries data averaged during the period 1980-2013, and the structural threshold regression method STR (Kourtellos et al,. 2015) to investigate the heterogeneous effects of the public education spending on growth considering governance indicators as threshold variable, we obtain evidence that this expenditure contributes positively to the economic performance only if the country is above the threshold level and presents good governance otherwise the effect is negative.

Keywords: Education Expenditure; Governance; Economic Growth; Threshold Effects; Structural Threshold Regression STR (search for similar items in EconPapers)
JEL-codes: I22 I25 P46 O43 H52 (search for similar items in EconPapers)
Date: 2018
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Handle: RePEc:jed:journl:v:43:y:2018:i:1:p:101-124