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The Education/Growth Relationship: Evidence from Real State Panel Data

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  • Michelle T. Bensi
  • David C. Black
  • Michael R. Dowd

Abstract

This article employs 1963–97 panel data for the 48 contiguous U.S. states (and District of Columbia) to examine the relationship between real personal income and real education expenditures as well as that between real personal income and six measures of real research and development expenditures. Bivariate regressions are employed to determine whether the information content between real education expenditures and real income runs from real income to real education spending or vice versa. The authors find that when data are relative to the U.S. average, the direction of information content runs from real state‐level education expenditures to real state‐level income. (JEL I2, H72)

Suggested Citation

  • Michelle T. Bensi & David C. Black & Michael R. Dowd, 2004. "The Education/Growth Relationship: Evidence from Real State Panel Data," Contemporary Economic Policy, Western Economic Association International, vol. 22(2), pages 281-298, April.
    • Handle: RePEc:bla:coecpo:v:22:y:2004:i:2:p:281-298
    DOI: 10.1093/cep/byh020
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    References listed on IDEAS

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    Cited by:

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    2. Nistor, Adela P., 2007. "Implications of Human Capital Public Investments for Regional Unemployment in Indiana," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 37(3), pages 1-8.
    3. Norman Baldwin & Stephen Borrelli, 2008. "Education and economic growth in the United States: cross-national applications for an intra-national path analysis," Policy Sciences, Springer;Society of Policy Sciences, vol. 41(3), pages 183-204, September.
    4. Rickman, Dan S. & Wang, Hongbo & Winters, John V., 2015. "Adjusted State Teacher Salaries and the Decision to Teach," IZA Discussion Papers 8984, Institute of Labor Economics (IZA).
    5. Schmidt, Stephen J. & McCarty, Therese A., 2008. "Estimating permanent and transitory income elasticities of education spending from panel data," Journal of Public Economics, Elsevier, vol. 92(10-11), pages 2132-2145, October.
    6. John Deskins & Brian Hill & Laura Ullrich, 2010. "Education Spending and State Economic Growth: Are All Dollars Created Equal?," Economic Development Quarterly, , vol. 24(1), pages 45-59, February.
    7. Ruba A. Aljarallah & Andrew Angus, 2020. "Dilemma of Natural Resource Abundance: A Case Study of Kuwait," SAGE Open, , vol. 10(1), pages 21582440198, January.
    8. Zachary Horváth & Brian David Moore & Jonathan C. Rork, 2014. "Does Federal Aid to States Aid the States?," Growth and Change, Wiley Blackwell, vol. 45(2), pages 333-361, June.
    9. Dan S. Rickman & Hongbo Wang & John V. Winters, 2017. "Relative Teacher Salaries And The Decision To Teach," Contemporary Economic Policy, Western Economic Association International, vol. 35(3), pages 542-550, July.
    10. Rickman, Dan & Wang, Hongbo, 2020. "What goes up must come down? The recent economic cycles of the four most oil and gas dominated states in the US," Energy Economics, Elsevier, vol. 86(C).

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    More about this item

    JEL classification:

    • I2 - Health, Education, and Welfare - - Education
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures

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