The Role of Government Health and education Expenditure on Economic Growth in Iran and OPEC Oil Exporting Countries

Authors

Department of Economics, Faculty of Economics and Social Science, Shahid Chamran University of Ahvaz, Ahvaz, Iran.

Abstract

Economic growth is one of the goals of development in economic plans of every country. Achieving self-development in OPEC member Oil-exporting countries takes precise awareness of the amount and cause of the impact of economic variables on each other and also, determining the policies and efficient, appropriate strategies for each case. Among these variables, oil revenues, total government expenditure, government expenditure for education, government expenditure for health, and economic growth could be mentioned. An examination of the trend of changes in health expenditure in Iran shows up until 2011. After this date, there has been a leap in these expenditures. The share of government education expenditure in the total government budget in Iran has been showing a steady and steady decline in these expenditures. In this research using panel data, studies relationship between health expenditure and education expenditure and economic growth in OPEC oil-exporting countries and Iran for 2004 to 2016. Hence, panel data method has been applied in order to estimate  models and panel var method has been applied in order to examine the causality relationships between variables. The results shows a positive meaningful relationship between oil revenues, total government expenditure, government expenditure for education, government expenditure in health, and economic growth of OPEC oil-exporting countries  and Iran in the studied period. Furthermere, the result of Granger Causality test suggest that there is a practical, mutual relationship between oil revenues and economic growth, total government expenditure and economic growth, and also a practical one-sided relationship of economic growth with government expenditure for education and also one-sided relationship of economic growth with government expenditure for health in OPEC member countries and Iran in the studied period.

Keywords