The effect of education expenditure on economic growth: Developed and developing countries

Economic growth has been an important policy objective for all countries from past to present. Economic growth is the increase in the country's welfare and income level. Education likewise contributes to economic development as well as welfare growth. Therefore, expenditures on education are of great importance for economic growth. The aim of this study is to econometrically investigate the effect of education expenditures on economic growth in developed and developing countries. In the study, the effect of education expenditures on national income in 20 developing and 27 developed countries is analyzed by panel ARDL method. The analysis period covers the period between 2000-2020. The results of the analysis show that changes in education expenditures have a positive effect on national income in both developed and developing countries. However, the effect of education expenditures in developed countries is bigger than in developing countries. Within the framework of the results obtained, it is concluded that the emphasis of countries on education expenditures within the framework of economic policies is an important point in terms of economic growth.