Do Education Expenditures Affect Economic Growth? Testing With Panel Data Analysis Method

Abstract The study aimed to examine whether education expenditures, basic education expenditures, secondary education expenditures and advanced education expenditures affect economic growth. In the study covering the duration 1990-2023, 6 major economies with complete data were considered. The econometric analysis first started with the correlation test of the series, and in the presence of correlation, the second-generation unit root test was applied, and in the absence of correlation, the first generation unit root test was applied. The presence of a cointegrated relationship in our research model allowed us to make long-term coefficient estimation. According to long-term coefficients, education expenditures, advanced and secondary education expenditures negatively affect economic growth; basic education expenditures have a positive impact. According to Dumitrescu and Hurlin Panel causality test; While a one-way causality relationship was detected between education expenditures, basic education expenditures, secondary education expenditures and economic growth; A bidirectional causality relationship was found between further education expenditures and economic growth.