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Decentralization: A cautionary tale

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  • Michael Kremer
  • Sylvie Moulin
  • Robert Namunyu
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    Abstract

    Kenya’s education system blends substantial centralization with elements of local control and school choice. This paper argues that the system creates incentives for local communities to build too many small schools; to spend too much on teachers relative to non-teacher inputs; and to set school fees that exceed those preferred by the median voter and prevent many children from attending school. Moreover, the system renders the incentive effects of school choice counterproductive by undermining the tendency for pupils to switch into the schools with the best headmasters. A randomized evaluation of a program operated by a non-profit organization suggests that budget-neutral reductions in the cost of attending school and increases in non-teacher inputs, financed by increases in class size, would greatly reduce dropout rates without reducing test scores. Moreover, evidence based on transfers into and out of program schools suggests that the population would prefer such a reallocation of expenditures.

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    File URL: http://karlan.yale.edu/fieldexperiments/papers/00290.pdf
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    Bibliographic Info

    Paper provided by The Field Experiments Website in its series Natural Field Experiments with number 00290.

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    Date of creation: 2003
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    Handle: RePEc:feb:natura:00290

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    Web page: http://www.fieldexperiments.com

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    1. James J. Heckman & Jeffrey A. Smith, 1995. "Assessing the Case for Social Experiments," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 85-110, Spring.
    2. Eric A. Hanushek, . "Interpreting Recent Research on Schooling in Developing Countries," Wallis Working Papers WP3, University of Rochester - Wallis Institute of Political Economy.
    3. Pritchett, Lant & Filmer, Deon, 1999. "What education production functions really show: a positive theory of education expenditures," Economics of Education Review, Elsevier, vol. 18(2), pages 223-239, April.
    4. Esther Duflo, 2000. "Schooling and Labor Market Consequences of School Construction in Indonesia: Evidence from an Unusual Policy Experiment," NBER Working Papers 7860, National Bureau of Economic Research, Inc.
    5. Thomas, Barbara P., 1987. "Development through Harambee: Who wins and who loses? Rural self-help projects in Kenya," World Development, Elsevier, vol. 15(4), pages 463-481, April.
    6. Edward Miguel & Michael Kremer, 2001. "Worms: Education and Health Externalities in Kenya," NBER Working Papers 8481, National Bureau of Economic Research, Inc.
    7. Olsen, Randall J & Farkas, George, 1990. "The Effect of Economic Opportunity and Family Background on Adolescent Cohabitation and Childbearing among Low-Income Blacks," Journal of Labor Economics, University of Chicago Press, vol. 8(3), pages 341-62, July.
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    Cited by:
    1. David K. Evans & Arkadipta Ghosh, 2008. "Prioritizing Educational Investments in Children in the Developing World," Working Papers 587, RAND Corporation Publications Department.
    2. Kremer, Michael & Miguel, Edward & Thornton, Rebecca & Ozier, Owen, 2005. "Incentives to learn," Policy Research Working Paper Series 3546, The World Bank.
    3. Michael Kremer & Edward Miguel, 2004. "The Illusion of Sustainability," Working Papers 35, Center for Global Development.
    4. Esther Duflo & Pascaline Dupas & Michael Kremer, 2012. "School Governance, Teacher Incentives, and Pupil-Teacher Ratios: Experimental Evidence from Kenyan Primary Schools," NBER Working Papers 17939, National Bureau of Economic Research, Inc.
    5. World Bank, 2007. "India - Rural governments and Service Delivery : Volume 2. Note," World Bank Other Operational Studies 8008, The World Bank.
    6. World Bank, 2007. "India - Rural Governments and Service Delivery : Volume 3. Main Report," World Bank Other Operational Studies 8009, The World Bank.
    7. Orazem, Peter & Glewwe, Paul & Patrinos, Harry, 2007. "The Benefits and Costs of Alternative Strategies to Improve Educational Outcomes," Staff General Research Papers 12853, Iowa State University, Department of Economics.

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