International Tax and Public Finance

, Volume 19, Issue 5, pp 677–707 | Cite as

Public education spending in a globalized world:

Is there a shift in priorities across educational stages?


This paper studies the effect of globalization on public expenditures allocated to different stages of education. First, we derive theoretically that globalization’s influence on education expenditures depends on the type of government. For benevolent governments, the model suggests that expenditures for higher education will increase and expenditures for basic education will decline with deepening economic integration. For Leviathan governments, on the other hand, the effects of globalization on public education spending cannot be unambiguously predicted. In the second part of the paper, we empirically analyze globalization’s influence on primary, secondary, and tertiary education expenditures with panel data covering 104 countries over the 1992–2006 period. The results indicate that globalization has led in both industrialized and developing countries to more spending for secondary and tertiary and to less spending for primary education.


Globalization Economic integration Public education Education expenditures 

JEL Classification

F15 H42 H52 



The authors thank the editor-in-chief of this journal Dhammika Dharmapala, two anonymous referees, Heinrich W. Ursprung, Guenther G. Schulze, and participants of the 2010 Royal Economic Society Meeting in Guildford, the 2010 IIPF Meeting in Uppsala, the 2010 Public Choice Society Meeting in Monterey, the 2009 CESifo Political Economy Workshop in Dresden, and of seminars at the University of Basle and the University of Gothenburg for helpful comments and suggestions.


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Copyright information

© Springer Science+Business Media, LLC 2011

Authors and Affiliations

  1. 1.Department of Economics and Gothenburg Centre of Globalization and DevelopmentUniversity of GothenburgGothenburgSweden
  2. 2.Department of Economics and ZukunftskollegUniversity of KonstanzKonstanzGermany

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