The analysis of the effect of private and state educational and health care expenditures on the economic growth of Iran

Abstract

Investment in educational and health sector is one of significant factors for economic growth in many countries. Lots of studies have been done in this field, However, The simultaneous effect of education and health and the importance of private and state sectors in economic growth of Iran have not been surveyed. Because of the significance of this investigation, various types of behavior in private and state sector in these areas, we have investigated the effects of private and state educational and health care expenditures on the economic growth of Iran using Auto-Regressive Distributed Lags (ARDL) method from 1965 to 2011. Statistical ramifications showed that state health care expenditures had a positive and significant effect on economic growth. However, private health care expenditures showed no significant effect on growth. Private educational expenditures had a positive significant effect on economic growth. However, State educational expenditures had a negative effect on economic growth which is not surprising because educational system faces serious problems such as discordance between the educational system and needs of society and labor market