Title: Public spending efficiency on human capital and income inequality in selected African countries

Authors: Isaiah Sikayena; Kwadwo Ankomah; Georgina Katakity; Frank Gyimah Sackey

Addresses: Department of Economics, School of Business, Ghana Communication Technology University, Ghana ' Department of Accounting Banking and Finance, School of Business, Ghana Communication Technology University, Ghana ' Department of Management Studies, University of Mines and Technology, Ghana ' Department of Economics, School of Business, Ghana Communication Technology University, Ghana

Abstract: This study examines the relationship between the efficiency of public spending on human capital, specifically education and health and income inequality in Selected African Countries, using system GMM with robust standard errors over the period 2006-2017. The findings reveal that efficient public spending on health reduces income inequality, while efficient spending on education initially increases inequality, forming an 'n-shaped' relationship. However, after a certain threshold, further improvements in education spending efficiency help reduce inequality. Based on these findings, the study recommends that African governments, along with ministries of health and education, prioritise maintaining high efficiency in public spending to effectively address income inequality and foster equitable development across the continent.

Keywords: income inequality; efficiency of public spending; human capital; health; education.

DOI: 10.1504/AJESD.2025.149243

African Journal of Economic and Sustainable Development, 2025 Vol.10 No.3, pp.211 - 230

Received: 20 Oct 2024
Accepted: 17 Mar 2025
Published online: 20 Oct 2025 *

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