The Impact of the Public Education Expenditures on Regional Development in Turkey: Evidence from Static and Dynamic Panel Data

This study aims to analyze the impact of public education expenditures on regional economic development in Turkey. For this purpose, we test the hypothesis that there is a strong relationship between education expenditures and economic growth/development using static and dynamic panel data (system GMM) methods. In the analysis, we use annual data on central government education expenditures and regional GDP per capita data for the period 2004– 2019 for 81 provinces at NUTS-III level. The findings of the study revealed a positive relationship between central government education expenditures and regional development. In other words, regional development accelerates if education expenditures increase. However, the magnitude of the effect is not as strong as is expressed in the hypothesis: a ten percent increase in education spending only increases economic development by 1.1 percent.