Education and economic growth: a spatial-econometric analysis for the municipalities from southeast’s Brazil

Abstract

This work used an expanded spatial version of MRW’s model (Mankiw, Romer e Weil, 1992) to analyze the education impact on per capita income growth of cities from Brazil’s southeastern between 2000-2010. The results suggest this impact is greater in urban and developed locations, with larger population size and lower levels of inequality. It was estimated that a 10% growth in education would increase income between 4.28% and 5.54%, with greater/lesser impacts São Paulo/Minas Gerais cities. In an ideal scenario, the income would increase up to 32.3% only with improvements in education. Although high, this effect would be overestimated if the spatial dependence were ignored.