The Determinants of Public Education Expenditure in Malaysia

The Determinants of Public Education Expenditure in Malaysia. Jurnal Ekonomi Malaysia, 52 (2). pp. 109-122. ISSN 2716-6058 (2018)


The aim of this paper is to investigate the determinants of the public education expenditure in Malaysia during the
period of 35 years from 1982 to 2016. This study intends to address the existing research gaps within Malaysia context
that failed to receive much attention in the past. The determinants of education expenditure will be modeled using
time series data within the autoregressive distributed lag (ARDL) Bound Testing approach and Error Correction Model
(ECM) method. The empirical findings from this study identified the real gross domestic product growth rate (GDP),
unemployment rate (UNEM), inflation rate (INF) and working age population (POP2) as the long run determinants of
public education expenditure. Findings from the ARDL Bound Testing result further supported the Keynesian CounterCyclical theory as implied by the negative relationship between economic growth and public education expenditure in
the long run. The short run analysis through ECM demonstrated that fluctuations in education expenditure was sensitive
to the real gross domestic product growth rate (D(GDP)), unemployment rate (D(UNEM)), population of age less than
15 (D(LNPOP1)), and population of age greater than 64 (D(LNPOP3)). This study further recommends that the policy
makers to play the role in responding to the economic conditions and demands of the society in their decision-making
of the future allocation.

Item Type: Article
Keywords: Determinants, education expenditure, ARDL bound testing, ECM, time series
Taxonomy: By Subject > Business & Management > Economics
Local Content Hub: Subjects > Business & Management
Depositing User: Eza Eliana Abdul Wahid
Date Deposited: 01 Aug 2021 13:49
Last Modified: 01 Aug 2021 13:49
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