The Regulatory Effect of Public Education Expenditures On Income Distribution

Abstract

The education system is one of the important factor which effects to development level of a country. Beside the quality of educational system, equity in access to the education is the important topic too. Equity in access to education can help to equitable income distribution, to between different income groups who live in a country. It is stated that, nowadays inequalities on income distribution have reached very serious dimensions. It is believed that, education expenditures, which make by government, can be important tool to reduce the inequality especially inside the countries. The aim of this study is to evaluate to general government education expenditures/Gross Domestic Product (GDP) ratios at the member countries of Organisation for Economic Co-operation and Development (OECD) where income relatively equitable distributes. The effects of education level on a country’s economy are evaluated in the first chapter of the study. It is stated that, the quality education systems have positive effects to the development levels of the countries. Information is also provided about the dimensions of income inequality in the first chapter. Additionally it is mentioned that, providing equality in access to education has probable positive effects on the income inequality. Numerical values about general government education expenditures/GDP ratios in OECD countries where income distribution relatively more equitable (Gini coefficients are used in the measurement of income distribution in this study), are included in the second chapter. OECD data are used for both variables in this study. When the data in the study are evaluated, it can be said that the level of public education expenditures have positive effects on income distribution in general. The equitable distribution of income in a country can be due to different reasons. However it can be said that, the education services, which are provided by government, because there are more equitable access to these services, can be used as a tool for reduce the inequality when we generally evaluation.