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Education Expenditures, Inequality and Economic Growth: Empirical Analysis of the Transmission Channels

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  • Salwa Trabelsi

    (High School of Economic and Commercial Sciences of Tunis, University of Tunis (ESSEC of Tunis) and Laboratory DEFI, University of Tunis, Tunisia)

Abstract

Many economists have confirmed the negative and direct relationship between economic growth and income inequality. Recent studies have tried to analyse the different transmission channels through which inequality may affect economic performance indirectly. In this paper, we are only referring to the education channels: public and private education expenditures and human capital, in order to evaluate the role of each in the explanation of this negative correlation. We noticed that a high level of inequality requires more public resources this may impede economic growth. Income inequality also discourages private financing in education and human capital accumulation which leads to a sluggish economic growth. These findings imply that private education expenditure is the most important channel which explains this negative relationship reported in the literature.

Suggested Citation

  • Salwa Trabelsi, 2018. "Education Expenditures, Inequality and Economic Growth: Empirical Analysis of the Transmission Channels," Research Journal of Education, Academic Research Publishing Group, vol. 4(2), pages 26-35, 02-2018.
    • Handle: RePEc:arp:rjearp:2018:p:26-35
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    References listed on IDEAS

    as
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    3. Alesina, Alberto & Perotti, Roberto, 1996. "Income distribution, political instability, and investment," European Economic Review, Elsevier, vol. 40(6), pages 1203-1228, June.
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    More about this item

    Keywords

    Public and private education expenditures; Human capital; Economic growth; Income inequality; Transmission channels;
    All these keywords.

    JEL classification:

    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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