The Effect of of Income Distribution Inequality on Government Education Expenditure in Iran's Economy: New Evidence from an ARDL Approach

Abstract

Income distribution is one of the most important issues in humans Inequality society that has been considered by economists since the time of Adam smith And with the advent of economics. One of the most important economics tasks is to control the inequality of income distribution. Governments can reduce the problem of income inequality by using theoretical and practical methods in society. Expenditures in the Iranian economy using the method of Autoregerssive Distributed Lag (ARDL) during the period 1987-2019. The research results indicate that with %1 increase in GDP government education expenditures increase in GDP to %3/79. With the increase of an unequal unit for income distribution (Gini coefficient) the ratio of government education expenditures to gross domestic product GDP increases by %8.58 per cent. This result could be evidence of the Validity of the theory between Milters And Richard (1981) in government education Spending. In the sense that possibly due to the political pressures on the government to redistribute revenue government education spending has increased as income inequality has increased. With the increase of one unit of human Capital (literacy rate) government education expenditures in gross national product GDP %14 percentage decrease. As the number of students increases by one million, the ratio of government education expenditures to gross domestic product (GDP) increases by % 6/75 Per cent. With a one percent increase in the Democracy Index, government education expenditures increase by 0.11 percent of gross domestic product (GDP). With the increase of one unit of human capital (literacy rate), government education expenditures in gross domestic product (GDP) 0/014 The percentage decreases.

Keywords

• income distribution inequality
• government education expenditures
• - auto regressive distributed log