Fiscal Marksmanship of Education Expenditure in India: Analyzing Forecast Errors through a Gender lens

Chakraborty, Lekha S and Chowdhury, Samik (2005): Fiscal Marksmanship of Education Expenditure in India: Analyzing Forecast Errors through a Gender lens.

Abstract

According to rational expectation hypothesis, information is scarce and the economic agents generally do not waste information and that expectations depend specifically on the structure of entire system. Fiscal marksmanship, the accuracy of budgetary forecasting, can be one important piece of such information the rational agents must consider in forming expectations. Using Theil’s inequality coefficient (U) based on the mean square prediction error, the paper estimates the magnitude of errors in the budgetary forecasts of gender-related expenditure in India, in particular the education sector. The results showed that degree of errors in forecasting gender-related expenditure in education sector is relatively less compared to other sectors. However there is no specific trend in the forecasting errors, which reveals that budgetary estimates of gender-related expenditure are made not based on adaptive expectations. The applicability of rational expectations hypothesis in fiscal estimates of gender-related expenditure, in particular education sector, also has limited scope in India. Fiscal marksmanship deals more with the ‘budget measures’ rather than ‘fiscal incidence’ measures, but the paper has taken into account the fiscal incidence measure through a gender disaggregated public expenditure benefit incidence analysis of education sector.

• Item Type: MPRA Paper
• Language: English
• Keywords: Fiscal Marksmanship, Rational Expectations, Gender Disaggregated Public Expenditure Benefit Incidence Analysis.
• Subjects: C - Mathematical and Quantitative Methods > C4 - Econometric and Statistical Methods: Special Topics > C49 - Other; C - Mathematical and Quantitative Methods > C5 - Econometric Modeling > C53 - Forecasting and Prediction Methods ; Simulation Methods; H - Public Economics > H4 - Publicly Provided Goods; H - Public Economics > H4 - Publicly Provided Goods > H44 - Publicly Provided Goods: Mixed Markets; H - Public Economics > H5 - National Government Expenditures and Related Policies > H52 - Government Expenditures and Education; H - Public Economics > H6 - National Budget, Deficit, and Debt > H68 - Forecasts of Budgets, Deficits, and Debt; I - Health, Education, and Welfare > I2 - Education and Research Institutions > I22 - Educational Finance ; Financial Aid; I - Health, Education, and Welfare > I2 - Education and Research Institutions > I24 - Education and Inequality; I - Health, Education, and Welfare > I2 - Education and Research Institutions > I28 - Government Policy

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