Equity in educational expenditures : can government subsidies help?
AbstractWhen there are externalities across households, governments can improve economic outcomes by equitably subsidizing education. But this chain of causality works only if (1) allocated resources reach the final recipients, and (2) equity in public subsidies translates directly into equity in total educational expenditures, including private spending at the household level. Using a unique data set fromZambia, the author shows that whether these conditions are met depends on the specific schemes used to allocate resources as well as the exact form of the subsidies. First, subsidies allocated through clear guidelines and legislated rules reached the final recipients, but those allocated at the discretion of province and educational offices did not. Second, even those components of subsidies that were progressive (in that the share of total subsidies for the poor was greater than the share for the non-poor) had no effect on inequality in total educational expenditures due to the crowding-out of household spending.
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Bibliographic InfoPaper provided by The World Bank in its series Policy Research Working Paper Series with number 3249.
Date of creation: 01 Mar 2004
Date of revision:
Economic Theory&Research; Environmental Economics&Policies; Teaching and Learning; Decentralization; Payment Systems&Infrastructure; Teaching and Learning; Economic Adjustment and Lending; Health Economics&Finance; Economic Theory&Research; Environmental Economics&Policies;
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