The Impact of Public Education Expenditure on Human Capital, Growth, and Poverty in Tanzania and Zambia: A General Equilibrium Approach
August 1, 2001
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Summary
The impact of public education expenditure on human capital, the supply of different labor skills, and its macroeconomic and distributional consequences is appraised within a multisector CGE model. The model is applied to and calibrated for two Heavily Indebted Poor Countries (HIPCs), Tanzania and Zambia. The simulation results suggest that education expenditure can raise economic growth. However, to maximize benefits from education expenditure, a sufficiently high level of physical investment is needed, as are measures that improve the match between the pattern of educational output and the structure of effective demand for labor. An important result of the simulation experiments is that a well-targeted pattern of education expenditure can be effective for poverty alleviation.
Subject: Education, Education spending, Expenditure, Labor, Labor supply, Wages
Keywords: CGE, educated labor, education, Education spending, labor measure, labor stock, labor supply, Labor supply, possibility frontier, poverty, public expenditure, Tanzania, wage, wage rate, Wages, WP, Zambia
Pages:
37
Volume:
2001
DOI:
Issue:
106
Series:
Working Paper No. 2001/106
Stock No:
WPIEA1062001
ISBN:
9781451852899
ISSN:
1018-5941
