This study examines the primary factors influencing public education spending in Nepal across various stages of schooling and expenditure categories in recent decades. Drawing on a multidimensional theoretical framework that integrates economic-demographic theory and Wagner’s Law, Keynesian counter-cyclical theory, decision-making (incrementalism) theory, and public-choice perspectives such as fiscal illusion and the political business cycle, the analysis employs ordinary least squares (OLS) multiple regression on national-level time-series data spanning twenty-two years (2000–2021). Six expenditure categories—total, current, capital, basic, higher, and vocational education expenditure—are estimated as functions of economic, demographic, decision-making, and political variables. The findings indicate that the lagged (incremental) expenditure variable is the single most consistent and powerful determinant across all six equations, confirming that budgetary decisions in Nepal are overwhelmingly shaped by the previous year’s allocation. Among economic variables, industrialization exerts a positive influence on total and higher-education spending consistent with Wagner’s Law, while inflation and unemployment display limited and largely pro-cyclical effects that contradict Keynesian expectations. Demographic and educational indicators are broadly neglected, with the number of teachers being the only variable exerting a significant influence, reflecting the dominance of salary obligations in recurrent spending. Among political variables, only the indirect-tax ratio is significant, and its consistently negative sign contradicts the fiscal illusion theory. The results portray Nepal’s education-financing process as predominantly incremental, supply-driven, and weakly responsive to demographic need.