his articleis concerned with the study of the relationshipbetween public expenditure and urban
economic growth while also focusing on the effect of public investment on the urban economic
growth of Khon Kaen. The research questions are as follows; (1)how has the economy of Khon
Kaen grown and (2) has the growth of Khon Kaen's economy resulted from public investment. If so,
(3) what is the main driving force and what impact does ithave. Results showed that urban growth
can be divided into two periods which are pre-policy and post-policy. The northeast development
policy is considered to be an important government policy which most strongly affected urban
growth. Public investment has been the main driving force during the firstperiod, causing the inflow
ofa considerable amount of money along with the growth in the number of workers in Khon
Kaen. There was some outward movement but higher numbers moved in to take their place,leading
to the overall growth of commercial and private services.During the second period, education man?
?ed through Khon Kaen University has been the main driving force leading to the growth of a large
amount of the investment, and of numbers of workers and residents in Khon Kaen University. In
addition,it has also led to greatly expanded consumption and more diverse commercial and private
services.These multipliers at Khon Kaen University radically affected rban incomes, compared to
other public investments during 2010. The research confirms that public investment continues to be
the driving force of the economic growth of Khon Kaen. In regards to the results,other questions
have been raised, for instance how Khon Kaen is going to grow in the near future and how Khon
Kaen University, as the main driving force,will grow?