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Decentralization: A cautionary tale

  • Michael Kremer
  • Robert Namunyu
  • Sylvie Moulin
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    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://s3.amazonaws.com/fieldexperiments-papers/papers/00290.pdf
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    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
    Contact details of provider: Web page: http://www.fieldexperiments.com

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    1. 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.
    2. Hanushek, Eric A, 1995. "Interpreting Recent Research on Schooling in Developing Countries," World Bank Research Observer, World Bank Group, vol. 10(2), pages 227-46, August.
    3. 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.
    4. 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.
    5. 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.
    6. 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.
    7. Edward Miguel & Michael Kremer, 2001. "Worms: Education and Health Externalities in Kenya," NBER Working Papers 8481, National Bureau of Economic Research, Inc.
    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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