Growth of Social Sector Expenditures on Education in India: A State Level Analysis

Abstract

The claims of the Indian government that it is fully committed to address the issues of poverty eradication and social development have continued over time. The present paper attempts to understand the growth of social sector expenditures on education. For doing that it first checked whether the series of social sector expenditure on education for different states converges to a path having trend preserving properties, secondly, looked at the occurrence of structural break in the series and thirdly, analysed the growth of social sector expenditures on education for Indian states. Finally, the factors contributing to social sector expenditure on Indian education are tried to be found out. For studying growth rate of social sector expenditures on education, three alternative indicators are taken and structural break analysis of modern time series econometrics is employed. For finding out the factors, panel regression is done. There is evidence of interstate disparity with regard to break point as well as growth rate before and after break. For most of the states the growth rate has increased. The determinants such as net state domestic product, own tax revenue and fiscal deficit with one-year lag are found to affect social sector expenditures on education positively.