The impact of public expenditure on human development: Dynamic panel data analysis in selected OECD countries

In this thesis, the effects of public expenditures on human development in a sample of 26 OECD countries selected for the period 2000–2020 were examined using dynamic panel data analysis. In the theoretical framework, the multidimensional nature of development and the role of public expenditures on social welfare were addressed; in particular, the effects of education, health and social protection expenditures on the quality of life of individuals were evaluated. Empirical findings show that public expenditures have a positive and statistically significant effect on the Human Development Index (HDI). In addition, it was determined that income equality, economic growth and corruption control variables also have positive effects on the HDI. In contrast, the effect of the globalization variable on the HDI was found to be negative and significant. The findings point to the importance of restructuring public policies in line with human-centered development goals. This study empirically reveals the relationship between human development and fiscal policy in the context of OECD countries and emphasizes that the social aspect of public expenditures should be taken into consideration by policy makers.