Lidija Madzar

Faculty of Finance, Banking and Auditing, Alfa BK University, Belgrade, Serbia

Abstract: Knowledge is one of the key factors of economic growth, as well as of sources of competitiveness in the global marketplace. Educational policy directly shapes and creates human capital that is the backbone of the future development of each country. Therefore, there is a need for planning, good design and comprehensive financing this important social field. The purpose of this article is to determine the trends of public expenditures on education in the Republic of Serbia (RS), as well as their impact on the development of Serbian society. The article first provides a detailed analysis of the higher education system in Serbia, monitoring the trends in the share of education expenditures in gross domestic product (GDP) and total public expenditures in the country. The paper applies the desk research methodology as it analysis the professional literature, articles, relevant reports and databases of leading international institutions such as the European Union, OECD, Statistical Office of RS, UNESCO, World Bank, UNDP and Eurostat. The article studies the evolution, values and Human Development Index (HDI) ranks of Serbia, Gross Expenditure on Research and Development (GERD) in the Serbian higher education sector, as well as their correlations with Serbian public expenditures for education, in the period from 2009 to 2019. The article also applies linear regression analysis between the observed variables. Finally, it concludes that public expenditures on education could not contribute to social development in Serbia due to the small regression coefficients and weak correlations among these indicators. Therefore, Serbia should invest continuously and more intensively in its higher education if it wants to prosper. This article is useful for policy makers, but also for a wider readership who want to be acquainted with the education and social development trends in Serbia.

Keywords: knowledge, higher education in Serbia, education financing, social development, Human Development Index (HDI), Gross Expenditure for Research and Development (GERD).

JEL classification: H52, I22, O30.



Madzar, L., 2022. Macroeconomic Analysis of the Financing of Education System in the Republic of Serbia. Oradea Journal of Business and Economics, 7(1), pp. 8-18,