Open AccessEducation and Poverty in Morocco: A Computable General Equilibrium Micro-simulation Analysis
Author(s) -
Mohamed Karim,
Mohamed El Moussaoui
Publication year - 2020
Publication title -
journal of economics and public finance
Language(s) - English
Resource type - Journals
eISSN - 2377-1046
pISSN - 2377-1038
DOI - 10.22158/jepf.v6n1p116
Subject(s) - computable general equilibrium , economics , poverty , unit (ring theory) , investment (military) , welfare , inequality , higher education , government (linguistics) , public spending , general equilibrium theory , poverty reduction , public economics , economic growth , labour economics , macroeconomics , political science , market economy , mathematical analysis , linguistics , philosophy , mathematics education , mathematics , politics , law
The paper uses a micro-simulation computable general equilibrium model (CGE) to analyze the impact on poverty of public spending in higher education in Morocco. The model incorporates 7062 households derived from the 2007 National Survey on Household Living Standards (ENNVM). Two scenarios are simulated: a 100% reduction in the unit cost of higher education supported by households and a 50% reduction in public spending on higher education. In this study, it is assumed that the investment behavior of households is linked to the share of the unit cost financed by the government in higher education. The results show that the policy of exempting households from bearing any unit cost of higher education encourages them to invest massively in education, which leads to increasing their income and consequently improving welfare and reducing poverty and inequalities. On the other hand, the reduction in public investment in higher education affects negatively the behavior of households to invest in education which leads to a decrease in welfare, an increase in poverty and a rise of inequalities.