The Nexus Between Public Spending on Education and Economic Growth of Kosovo (Econometric Approach)
DOI:
https://doi.org/10.2478/eb-2020-0019Keywords:
public spending, education, economic growth, sustainability, OLSAbstract
The main aim of this study is to analyse the trend of public spending dedicated to education in case of Kosovo over the years and to measure the impact of public spending in education on economic growth of Kosovo. In order to achieve the aim, the Pearson Correlation has been used and a multifactorial regression model (OLS) has been modified and adapted, where we have determined the Gross Domestic Product (GDP) as a dependent variable and as an independent variable in the model: (i) Public expenditure on secondary education and (ii) Public expenditure on higher education (university). The data used are secondary data from the Kosovo’s State Budget, Ministry of Finance and Transfers, and Kosovo Agency of Statistics. We have come to a conclusion that public spending dedicated to higher education (university) has a positive impact on Kosovo’s economic growth meanwhile public spending on secondary education does not show any effect. The paper suggests further recommendations on public spending policies dedicated to education in order to influence Kosovo’s economic growth.References
Akbari, M. Z. (2016). The role of education in economic development. Available from http://www.outlookafghanistan.net/topics.php?post_id=16303
Barro, R. J., & Lee, J.-W. (2010). A New Dataset of Educational Attainment in the World, 1950–2010. NBER Working paper No. 15902. Cambridge, National Bureau of Economic Research. https://doi.org/10.3386/w15902
Becker, G. S. (1993). Human Capital. A Theoretical and Empirical Analysis, with Special Reference to Education. University of Chicago Press. https://doi.org/10.7208/chicago/9780226041223.001.0001
Benhabib, J. & Spiegel, M. M. (1994). The role of human capital in economic development evidence from aggregate cross-country data. Journal of Monetary Economics, 34(2), 143–174. https://doi.org/10.1016/0304-3932(94)90047-7
Berger N., & Fisher, P. (2013). A well-educated workforce is key to state prosperity. Economic Policy Institute.
Bexheti, A., & Mustafi, B. (2015). Impact of public funding of education on economic growth in Macedonia. Bamberg Working Paper Series.
Cooray, A. V. (2009). The role of education in economic growth. 38th Australian Conference of Economists. https://doi.org/10.2139/ssrn.1520160
Friedman, M. (2002). The Market Can Transform Our Schools. New York Times.
Grant, C. (2017). The contribution of education to economic growth. Institute of Development Studies.
Gujarati, (2004). Basic Econometric, Fourth Edition, https://abenkhalifa.files.wordpress.com/2016/12/damodar-gujarati-basic-econometrics.pdf
Hanushek, E., & Wößmann, L. (2010). Education and economic growth. International Encyclopedia of Education, 2010, 245–252. https://doi.org/10.1016/B978-0-08-044894-7.01227-6
Komatsu, H., & Rappleye, J. (2017). A new global policy regime founded on invalid statistics? Hanushek, Woessmann, PISA, and economic growth. Comparative Education, 53(2), 166–191. https://doi.org/10.1080/03050068.2017.1300008
Marshall, A. (1890). Principles of economics.
Michaelowa, K. (2000). Returns to education in low income countries: Evidence for Africa. Committee on Developing Countries of the German Economic Association. Annual meeting, Berlin, June 2000.
Mitra, D. (2011). The Social and Economic Benefits of Public Education. Available: https://www.elcpa.org/wp-content/uploads/2011/06/BestInvestment_Full_Report_6.27.11.pdf
OECD. (2020). Education Spending. Available: https://data.oecd.org/eduresource/education-spending.htm
Ozturk, I. (2008). The role of education in economic development: A Theoretical perspective. Available at SSRN: https://ssrn.com/abstract=1137541 or http://dx.doi.org/10.2139/ssrn.1137541
Roberts, J. (2003). Poverty reduction outcomes in education and health, public expenditure and aid. Overseas Development Institute. Working paper 210.
Roser, M., & Ospina, O. E. (2016). Global growth of education. Our World in Data.
Smith, A. (1776). The Wealth of Nations. New York: Library.
Schwab, K. (2016). Global Competitiveness Report. World Economic Forum.
Sparreboom, T., & Staneva, A. (2014). Is education the solution to decent work for youth in developing economies? Work4Youth Publication Series No. 23.
Stevens, P. & Weale, M. (2004). Education and Economic Growth. International Handbook on the Economics of Education. https://doi.org/10.4337/9781845421694.00009
Ziberi, B. (2020). Skills Mismatch in the Labor Market a Precondition of Brain - Drain Phenomenon in Developing Countries with Special Emphasis in Kosovo. Balkan and Near Eastern Journal of Social Sciences, 6, 24–30.
Ziberi, B., & Avdiu, M. (2020). Econometric analysis to examine the relationship between unemployment and macroeconomics aggregates. Evidence from Kosovo. Academic Journal of Economic Studies, 6(2), 33-41.
Barro, R. J., & Lee, J.-W. (2010). A New Dataset of Educational Attainment in the World, 1950–2010. NBER Working paper No. 15902. Cambridge, National Bureau of Economic Research. https://doi.org/10.3386/w15902
Becker, G. S. (1993). Human Capital. A Theoretical and Empirical Analysis, with Special Reference to Education. University of Chicago Press. https://doi.org/10.7208/chicago/9780226041223.001.0001
Benhabib, J. & Spiegel, M. M. (1994). The role of human capital in economic development evidence from aggregate cross-country data. Journal of Monetary Economics, 34(2), 143–174. https://doi.org/10.1016/0304-3932(94)90047-7
Berger N., & Fisher, P. (2013). A well-educated workforce is key to state prosperity. Economic Policy Institute.
Bexheti, A., & Mustafi, B. (2015). Impact of public funding of education on economic growth in Macedonia. Bamberg Working Paper Series.
Cooray, A. V. (2009). The role of education in economic growth. 38th Australian Conference of Economists. https://doi.org/10.2139/ssrn.1520160
Friedman, M. (2002). The Market Can Transform Our Schools. New York Times.
Grant, C. (2017). The contribution of education to economic growth. Institute of Development Studies.
Gujarati, (2004). Basic Econometric, Fourth Edition, https://abenkhalifa.files.wordpress.com/2016/12/damodar-gujarati-basic-econometrics.pdf
Hanushek, E., & Wößmann, L. (2010). Education and economic growth. International Encyclopedia of Education, 2010, 245–252. https://doi.org/10.1016/B978-0-08-044894-7.01227-6
Komatsu, H., & Rappleye, J. (2017). A new global policy regime founded on invalid statistics? Hanushek, Woessmann, PISA, and economic growth. Comparative Education, 53(2), 166–191. https://doi.org/10.1080/03050068.2017.1300008
Marshall, A. (1890). Principles of economics.
Michaelowa, K. (2000). Returns to education in low income countries: Evidence for Africa. Committee on Developing Countries of the German Economic Association. Annual meeting, Berlin, June 2000.
Mitra, D. (2011). The Social and Economic Benefits of Public Education. Available: https://www.elcpa.org/wp-content/uploads/2011/06/BestInvestment_Full_Report_6.27.11.pdf
OECD. (2020). Education Spending. Available: https://data.oecd.org/eduresource/education-spending.htm
Ozturk, I. (2008). The role of education in economic development: A Theoretical perspective. Available at SSRN: https://ssrn.com/abstract=1137541 or http://dx.doi.org/10.2139/ssrn.1137541
Roberts, J. (2003). Poverty reduction outcomes in education and health, public expenditure and aid. Overseas Development Institute. Working paper 210.
Roser, M., & Ospina, O. E. (2016). Global growth of education. Our World in Data.
Smith, A. (1776). The Wealth of Nations. New York: Library.
Schwab, K. (2016). Global Competitiveness Report. World Economic Forum.
Sparreboom, T., & Staneva, A. (2014). Is education the solution to decent work for youth in developing economies? Work4Youth Publication Series No. 23.
Stevens, P. & Weale, M. (2004). Education and Economic Growth. International Handbook on the Economics of Education. https://doi.org/10.4337/9781845421694.00009
Ziberi, B. (2020). Skills Mismatch in the Labor Market a Precondition of Brain - Drain Phenomenon in Developing Countries with Special Emphasis in Kosovo. Balkan and Near Eastern Journal of Social Sciences, 6, 24–30.
Ziberi, B., & Avdiu, M. (2020). Econometric analysis to examine the relationship between unemployment and macroeconomics aggregates. Evidence from Kosovo. Academic Journal of Economic Studies, 6(2), 33-41.
Downloads
Published
31.12.2020
Issue
Section
Articles
License
Copyright (c) 2020 Besime Ziberi et al., published by Sciendo
This work is licensed under a Creative Commons Attribution 4.0 International License.
How to Cite
Ziberi, B., Gashi, R., & Hodaj, M. (2020). The Nexus Between Public Spending on Education and Economic Growth of Kosovo (Econometric Approach). Economics and Business, 34, 285-296. https://doi.org/10.2478/eb-2020-0019
