IDEAS home Printed from https://ideas.repec.org/p/npf/wpaper/22-377.html
   My bibliography  Save this paper

Intergovernmental Fiscal transfers and Expenditure on Education in India: State level analysis, 2005 to 2020

Author

Listed:
  • Bose, Sukanya

    (National Institute of Public Finance and Policy)

  • Noopur, A.

    (National Institute of Public Finance and Policy)

  • Nayudu, Sri Hari

    (National Institute of Public Finance and Policy)

Abstract

There is large heterogeneity across Indian states in the public provisioning of education. The intergovernmental transfers with a mandate for equalisation have a role to play so that states can ensure these essential public goods. This study analyses the trends and patterns in intergovernmental transfers for education - school education and higher education, across three finance commission periods (2005-2020) which saw a number of important policy-induced changes in the overall fiscal framework. The 14th Finance Commission's (2015-2020) proposal of higher share of tax devolution to the states and a move towards general purpose transfers has been hailed as a major shift, which has allowed the states larger fiscal space. On the other hand, the central grants on education, particularly school education, have stagnated. Has it translated to an upward trend in spending on education in the 14th Finance Commission period vis-à-vis the earlier decade? Over time, have the public expenditure levels on school and higher education converged across states, which is the objective of equalisation? The answers to both the questions are negative. The study concludes with some policy recommendations, including restoration of financial concurrency through larger allocations on central schemes on education, and a special focus on the states at the bottom.

Suggested Citation

  • Bose, Sukanya & Noopur, A. & Nayudu, Sri Hari, 2022. "Intergovernmental Fiscal transfers and Expenditure on Education in India: State level analysis, 2005 to 2020," Working Papers 22/377, National Institute of Public Finance and Policy.
    • Handle: RePEc:npf:wpaper:22/377
    Note: Working Paper 377, 2022
    as

    Download full text from publisher

    File URL: https://nipfp.org.in/media/medialibrary/2022/03/WP_377_2022.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. M. Govinda Rao & Sudhanshu Kumar, 2018. "Envisioning tax policy for accelerated development in India," Asia-Pacific Sustainable Development Journal, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), vol. 25(1), pages 85-107, June.
    2. Chattopadhyay, Saumen, 2012. "Education and Economics: Disciplinary Evolution and Policy Discourse," OUP Catalogue, Oxford University Press, number 9780198082255, Decembrie.
    3. Bose, Sukanya & Ghosh, Priyanta & Sardana, Arvind & Boda, Manohar, 2021. "Regulation and Informal Market for Schools in Delhi," Working Papers 21/340, National Institute of Public Finance and Policy.
    4. Mukherjee, Sacchidananda & Chakraborty, Debashis & Sikdar, Satadru, 2014. "Three Decades of Human Development across Indian States: Inclusive Growth or Perpetual Disparity?," Working Papers 14/139, National Institute of Public Finance and Policy.
    5. Sacchidananda Mukherjee, 2020. "Inter-governmental Fiscal Transfers in the Presence of Revenue Uncertainty: The Case of Goods and Services Tax (GST) in India," Journal of Development Policy and Practice, , vol. 5(1), pages 74-102, January.
    6. De, Anuradha & Khera, Reetika & Samson, Meera & Shiva Kumar, A. K., 2011. "Probe Revisited: A Report on Elementary Education in India," OUP Catalogue, Oxford University Press, number 9780198071570, Decembrie.
    7. Mukherjee, Sacchidandanda, 2020. "Possible Impact of Withdrawal of GST Compensation Post GST Compensation Period on Indian State Finances," Working Papers 20/291, National Institute of Public Finance and Policy.
    8. Rao, M. Govinda, 2017. "The Effect of Intergovernmental Transfers on Public Services in India," Working Papers 17/218, National Institute of Public Finance and Policy.
    9. Rao, M. Govinda & Kumar, Sudhanshu, 2017. "Envisioning Tax Policy for Accelerated Development in India," Working Papers 17/190, National Institute of Public Finance and Policy.
    10. Choudhury, Mita & Mohanty, Ranjan Kumar, 2018. "Utilisation, Fund Flows and Public Financial Management under the National Health Mission," Working Papers 18/227, National Institute of Public Finance and Policy.
    11. Centre for Budget and Governance Accountability CBGA, 2018. "Of Hits and Misses: An Analysis of Union Budget 2018-19," Working Papers id:12475, eSocialSciences.
    12. Devesh Kapur, 2020. "Why Does the Indian State Both Fail and Succeed?," Journal of Economic Perspectives, American Economic Association, vol. 34(1), pages 31-54, Winter.
    13. Mukherjee, Anit K. & Sen, Tapas K., 2007. "Universalising elementary education: An assessment of the role of the sarva shiksha abhiyan," Working Papers 07/02, National Institute of Public Finance and Policy.
    14. Sukanya Bose, 2019. "Govind Bhattacharya, Special Category States of India," Journal of Development Policy and Practice, , vol. 4(2), pages 216-221, July.
    15. Bose, Sukanya & Ghosh, Priyanta & Sardana, Arvind, 2020. "Exit at the Bottom of the Pyramid: Empirical Explorations in the Context of Elementary Schooling in Delhi," Working Papers 20/306, National Institute of Public Finance and Policy.
    16. Amarnath, H.K. & Singh, Alka, 2019. "Impact of Changes in Fiscal Federalism and Fourteenth Finance Commission Recommendations: Scenarios on States Autonomy and Social Sector Priorities," Working Papers 19/257, National Institute of Public Finance and Policy.
    17. Amarnath H. K. & Alka Singh, 2019. "Impact of Changes in Fiscal Federalism and Fourteenth Finance Commission Recommendations Scenarios on States Autonomy and Social Sector Priorities," Working Papers id:13029, eSocialSciences.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ghosh, Anindita & Rangan, Divy & Chakraborty, Lekha, 2022. "Public Financial Management and Budgeting for Children: Evidence from Telangana, India," Working Papers 22/379, National Institute of Public Finance and Policy.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Sacchidananda Mukherjee & Shivani Badola, 2021. "Public Financing of Human Development in India: A Review," Indian Journal of Human Development, , vol. 15(1), pages 62-81, April.
    2. Bose, Sukanya & Bera, Manasi & Ghosh, Priyanta, 2020. "Centre-State Spending on Elementary Education: Is it Complementary or Substitutionary?," Working Papers 20/320, National Institute of Public Finance and Policy.
    3. Mukherjee, Sacchidananda, 2019. "State of Public Finance and Fiscal Management in India during 2001-16," Working Papers 19/265, National Institute of Public Finance and Policy.
    4. Rao, M. Govinda, 2017. "Public Finance in India in the Context of India's Development," Working Papers 17/219, National Institute of Public Finance and Policy.
    5. Sacchidananda Mukherjee, 2020. "Estimation and Projection of Petroleum Demand and Tax Collection from Petroleum Sector in India," Journal of Infrastructure Development, India Development Foundation, vol. 12(1), pages 39-68, June.
    6. Samik Chowdhury & Indrani Gupta, 2020. "Fiscal Space and Expenditure Priorities post -14th Finance Commission: A Study of Five Indian States," IEG Working Papers 400, Institute of Economic Growth.
    7. Amarnath, H.K. & Singh, Alka, 2019. "Impact of Changes in Fiscal Federalism and Fourteenth Finance Commission Recommendations: Scenarios on States Autonomy and Social Sector Priorities," Working Papers 19/257, National Institute of Public Finance and Policy.
    8. Lekha Chakraborty, 2019. "Indian Fiscal Federalism at the Crossroads: Some Reflections," Economics Working Paper Archive wp_937, Levy Economics Institute.
    9. M. Govinda Rao, 2018. "Public finance in India: some reflections," DECISION: Official Journal of the Indian Institute of Management Calcutta, Springer;Indian Institute of Management Calcutta, vol. 45(2), pages 113-127, June.
    10. Dillip Kumar MUDULI & Nityasundar MANIK, 2020. "Tax structure and economic growth in general category states in India: A panel auto regressive distributed lag approach," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(2(623), S), pages 225-240, Summer.
    11. Mathur, Ritu & Jaitli, Namrata & Amarnath HK,, 2022. "Child Development Index in India: Performance at District Level," Working Papers 22/371, National Institute of Public Finance and Policy.
    12. Pinaki Das & Bibek Paria & Shama Firdaush, 2021. "Juxtaposing Consumption Poverty and Multidimensional Poverty: A Study in Indian Context," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 153(2), pages 469-501, January.
    13. Anupama Roy, 2022. "Institutional ‘Presence’ and the Indian State: The Long Narrative," Studies in Indian Politics, , vol. 10(2), pages 185-200, December.
    14. Sonali Jain-Chandra & Tidiane Kinda & Kalpana Kochhar & Shi Piao & Johanna Schauer, 2019. "Sharing the Growth Dividend: Analysis of Inequality in Asia," Journal of Banking and Financial Economics, University of Warsaw, Faculty of Management, vol. 2(12), pages 5-28, September.
    15. Mukherjee, Sacchidananda, 2021. "Revenue Shortfall and GST Compensation: An Assessment," Working Papers 21/356, National Institute of Public Finance and Policy.
    16. Satis Devkota & Shankar Ghimire & Mukti Upadhyay, 2021. "What Factors in Nepal Account for the Rural–Urban Discrepancy in Human Capital? Evidence from Household Survey Data," Economies, MDPI, vol. 9(2), pages 1-14, May.
    17. Sapatnekar, Sanhita & Patnaik, Ila & Kishore, Kamal, 2018. "Regulating Infrastructure Development in India," Working Papers 18/230, National Institute of Public Finance and Policy.
    18. Mladen Djuric & Marina Dobrota & Jovan Filipovic, 2020. "Complexity-based quality indicators for human and social capital in science and research: the case of Serbian Homeland versus Diaspora," Scientometrics, Springer;Akadémiai Kiadó, vol. 124(1), pages 303-328, July.
    19. Vyas, Sangita & Gupta, Aashish & Khalid, Nazar, 2021. "Gender and LPG use after government intervention in rural north India," World Development, Elsevier, vol. 148(C).
    20. Ghosh, Priyanta & Bose, Sukanya, 2022. "Estimating the Excess Demand for Government Schools in Delhi: How much capacity creation is necessary?," Working Papers 22/387, National Institute of Public Finance and Policy.

    More about this item

    Keywords

    Intergovernmental Fiscal Transfers ; Grants ; Finance Commission ; Centrally Sponsored Schemes ; SSA ; Mid-day Meal ; Education Expenditure;
    All these keywords.

    JEL classification:

    • H52 - Public Economics - - National Government Expenditures and Related Policies - - - Government Expenditures and Education
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H75 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Government: Health, Education, and Welfare
    • H77 - Public Economics - - State and Local Government; Intergovernmental Relations - - - Intergovernmental Relations; Federalism
    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • I22 - Health, Education, and Welfare - - Education - - - Educational Finance; Financial Aid
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:npf:wpaper:22/377. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: S.Siva Chidambaram (email available below). General contact details of provider: http://www.nipfp.org.in .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.