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Educational expenditures and student performance among OECD countries

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  • Wolff, Edward N.

Abstract

Using data on educational spending for 31 OECD countries over the years 1988–2008 by level and type of expenditure, I first re-examine the so-called cost disease model on the basis of a new formulation of the model and, in so doing, provide a new implicit price deflator for educational expenditures. The cost disease effect in education is estimated to be one to two percentage points per year relative to constant prices based on the GDP deflator. Next, unlike many previous studies, I do find a positive and significant effect of secondary educational spending deflated using the traditional GDP deflator on both PISA math scores and literacy scores (both significant at the one percent level). Primary school spending is also a significant factor in explaining PISA literacy scores on the secondary school level. Somewhat surprisingly, the econometric results are weaker on the basis of the “corrected” educational deflator.

Suggested Citation

  • Wolff, Edward N., 2015. "Educational expenditures and student performance among OECD countries," Structural Change and Economic Dynamics, Elsevier, vol. 33(C), pages 37-57.
    • Handle: RePEc:eee:streco:v:33:y:2015:i:c:p:37-57
    DOI: 10.1016/j.strueco.2015.02.003
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    Cited by:

    1. Irina V. Zastrozhnikova & Nadiia V. Datsii & Nelya M. Filyanina & Petro S. Oleshko & Nataliia M. Shkvorchenko & Liliia A. Martynets, 2020. "Financial and Economic Support of the Organization of the Educational Process," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(Special 1), pages 299-309.
    2. Edward Wolff, 2015. "School Spending and Student Performance in OECD Countries, 1998-2011," NBER Chapters, in: Education, Skills, and Technical Change: Implications for Future U.S. GDP Growth National Bureau of Economic Research, Inc.

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    More about this item

    Keywords

    Educational expenditures; Productivity; International comparisons;
    All these keywords.

    JEL classification:

    • I20 - Health, Education, and Welfare - - Education - - - General
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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