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Decentralization: A cautionary tale

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  • Michael Kremer
  • Sylvie Moulin
  • Robert Namunyu

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.

Suggested Citation

  • Michael Kremer & Sylvie Moulin & Robert Namunyu, 2003. "Decentralization: A cautionary tale," Natural Field Experiments 00290, The Field Experiments Website.
  • Handle: RePEc:feb:natura:00290
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    References listed on IDEAS

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    1. Newman, John & Rawlings, Laura & Gertler, Paul, 1994. "Using Randomized Control Designs in Evaluating Social Sector Programs in Developing Countries," World Bank Research Observer, World Bank Group, vol. 9(2), pages 181-201, July.
    2. Hanushek, Eric A, 1995. "Interpreting Recent Research on Schooling in Developing Countries," World Bank Research Observer, World Bank Group, vol. 10(2), pages 227-246, August.
    3. Esther Duflo, 2001. "Schooling and Labor Market Consequences of School Construction in Indonesia: Evidence from an Unusual Policy Experiment," American Economic Review, American Economic Association, vol. 91(4), pages 795-813, September.
    4. 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.
    5. 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.
    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 341-362, July.
    8. 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.
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    Cited by:

    1. David K. Evans & Arkadipta Ghosh, 2008. "Prioritizing Educational Investments in Children in the Developing World," Working Papers WR-587, RAND Corporation.
    2. Orazem, Peter & Glewwe, Paul & Patrinos, Harry, 2007. "The Benefits and Costs of Alternative Strategies to Improve Educational Outcomes," Staff General Research Papers Archive 12853, Iowa State University, Department of Economics.
    3. Michael Kremer & Edward Miguel & Rebecca Thornton, 2009. "Incentives to Learn," The Review of Economics and Statistics, MIT Press, vol. 91(3), pages 437-456, August.
    4. Maria Cheung & Maria Perrotta Berlin, 2015. "The Impact of a Food for Education Program on Schooling in Cambodia," Asia and the Pacific Policy Studies, Wiley Blackwell, vol. 2(1), pages 44-57, January.
    5. David K. Evans & Arkadipta Ghosh, 2008. "Prioritizing Educational Investments in Children in the Developing World," Working Papers 587, RAND Corporation.
    6. World Bank, 2007. "India - Rural Governments and Service Delivery : Volume 3. Main Report," World Bank Other Operational Studies 8009, The World Bank.
    7. Asim,Salman & Chase,Robert S. & Dar,Amit & Schmillen,Achim Daniel, 2015. "Improving education outcomes in South Asia : findings from a decade of impact evaluations," Policy Research Working Paper Series 7362, The World Bank.
    8. Michael Kremer & Edward Miguel, 2007. "The Illusion of Sustainability," The Quarterly Journal of Economics, Oxford University Press, vol. 122(3), pages 1007-1065.
    9. Cinnirella, Francesco & Schueler, Ruth M., 2016. "The Cost of Decentralization: Linguistic Polarization and the Provision of Education," CEPR Discussion Papers 11274, C.E.P.R. Discussion Papers.
    10. Duflo, Esther & Dupas, Pascaline & Kremer, Michael, 2015. "School governance, teacher incentives, and pupil–teacher ratios: Experimental evidence from Kenyan primary schools," Journal of Public Economics, Elsevier, vol. 123(C), pages 92-110.
    11. World Bank, 2007. "India - Rural governments and Service Delivery : Volume 2. Note," World Bank Other Operational Studies 8008, The World Bank.

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