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An Empirical Analysis of the Impact of Public Expenditures on Education and Health on Poverty in Indian States

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  • Raghbendra Jha
  • Bagala Biswal
  • Urvashi D. Biswal

Abstract

The principal objective of this study is to test whether public expenditures on education, health and other development activities have been effective in reducing poverty in India. To ensure sensitivity and robustness of the results, three different measures of poverty belonging to the Foster-Greer-Thorbecke group of poverty measures are used. We consider various types of education expenditures, viz., government expenditures on elementary, secondary, higher/university and "other" levels. Data for fourteen Indian states from 13th to 53rd rounds of National Sample Survey of India are used for estimating poverty. Using unbalanced panel data techniques, we test Fixed effects, Random effects and OLS models, and concludes that education, health and development expenditures help reduce poverty. In particular, expenditure on higher, university, technical, adult and vocational educations as opposed to elementary and secondary education is more effective in poverty reduction. Several policy conclusions are advanced.

Suggested Citation

  • Raghbendra Jha & Bagala Biswal & Urvashi D. Biswal, 2001. "An Empirical Analysis of the Impact of Public Expenditures on Education and Health on Poverty in Indian States," ASARC Working Papers 2001-05, The Australian National University, Australia South Asia Research Centre.
    • Handle: RePEc:pas:asarcc:2001-05
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    References listed on IDEAS

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    Cited by:

    1. Mukherjee, Nandini & Chatterjee, Biswajit, 2014. "Poverty and Inequality in urban India with special reference to West Bengal," MPRA Paper 64493, University Library of Munich, Germany.
    2. Manmohan Agarwal & Rimon Saha, 2021. "Water and Sanitation: Achievement of Large Indian States," Indian Journal of Human Development, , vol. 15(1), pages 82-99, April.
    3. Bhattacharya, Haimanti & Innes, Robert, 2006. "Is There a Nexus between Poverty and Environment in Rural India?," 2006 Annual meeting, July 23-26, Long Beach, CA 21201, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    4. Stefano Paternostro & Anand Rajaram & Erwin R. Tiongson, 2007. "How Does the Composition of Public Spending Matter?," Oxford Development Studies, Taylor & Francis Journals, vol. 35(1), pages 47-82.

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    More about this item

    Keywords

    India; Poverty Indices; Public Expenditures on Education and Health; Fixed and Random Effect Models; Panel Data;
    All these keywords.

    JEL classification:

    • H51 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Health
    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • H53 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Welfare Programs
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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