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Impact of increased public education spending on growth and poverty in Uganda. An integrated micro-macro approach


  • Véronique Robichaud
  • Luca Tiberti
  • Hélène Maisonnave


The objective of this paper is to assess the impact of increased public expenditures in education on school participation, skill level of the workforce, occupational choices between self‐employed and wage earners, economic performance, poverty reduction and income distribution. These additional expenditures in education are financed either through increased indirect taxes, or using the funds to be generated by the exploitation of oil resources. The best suited tool to evaluate the impact of such policies and financing mechanisms on the economy is a computable general equilibrium model (CGE) as this type of tool takes into account the interactions between all of the actors of an economy in a consistent framework. Impacts on prices, volumes and school performance will affect differently the households and thus, in order to compute how these results will affect the income distribution and poverty, a micro model is needed as well. Standard CGE models do not explicitly set out the relationship between education spending, school performance, skill level of workers and their choices on the labor market. Hence, we suggest using an integrated dynamic macro‐micro approach that models those important linkages, where a detailed schooling module is developed at both the macro and micro level to track the transition of students into the skilled and unskilled labor markets.

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  • Véronique Robichaud & Luca Tiberti & Hélène Maisonnave, 2014. "Impact of increased public education spending on growth and poverty in Uganda. An integrated micro-macro approach," Working Papers MPIA 2014-01, PEP-MPIA.
  • Handle: RePEc:lvl:mpiacr:2014-01

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    References listed on IDEAS

    1. Laurence J. Kotlikoff & Kent Smetters & Jan Walliser, 2001. "Finding a Way Out of America's Demographic Dilemma," NBER Working Papers 8258, National Bureau of Economic Research, Inc.
    2. François Bourguignon & Anne-Sophie Robilliard & Sherman Robinson, 2003. "Representative versus real households in the macro-economic modeling of inequality," Working Papers DT/2003/10, DIAL (Développement, Institutions et Mondialisation).
    3. François Bourguignon & Maurizio Bussolo & Luis Pereira, 2008. "The Impact of Macroeconomic Policies on Poverty and Income Distribution," Post-Print halshs-00754864, HAL.
    4. Sherman Robinson & Andrea Cattaneo & Moataz El-Said, 2001. "Updating and Estimating a Social Accounting Matrix Using Cross Entropy Methods," Economic Systems Research, Taylor & Francis Journals, vol. 13(1), pages 47-64.
    5. Andrea Bassanini & Jørn Henrik Rasmussen & Stefano Scarpetta, 1999. "The Economic Effects of Employment-Conditional Income Support Schemes for the Low-Paid: An Illustration from a CGE Model Applied to Four OECD Countries," OECD Economics Department Working Papers 224, OECD Publishing.
    6. Maria Inés Terra & Marisa Bucheli & Silvia Laens & Carmen Estrades, 2005. "The effects of increasing openness and integration to the MERCOSUR on the Uruguayan labour market. A CGE modeling analysis," Documentos de Trabajo (working papers) 1205, Department of Economics - dECON.
    7. Sebastian Edwards & Alejandra Cox Edwards, 2002. "Social Security Privatization Reform and Labor Markets: The Case of Chile," NBER Working Papers 8924, National Bureau of Economic Research, Inc.
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    More about this item


    Child Poverty; Education; Dynamic General Equilibrium; Micro-Simulation; Uganda;

    JEL classification:

    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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