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What educational production functions really show : a positive theory of education spending

  • Pritchett, Lant
  • Filmer,Deon

The accumulated results of empirical studies show that the public sector typically chooses spending on inputs such that the productivity of additional spending on books and instructional materials is 10 to 100 times larger than that of additional spending on teacher inputs (for example, higher wages, small class size). The authors argue that this pervasive and systemic deviation of actual spending from the technical optimum requires a political, not economic or technical, explanation. The evidence is consistent only with a class of positive models in which public spending choices are directly influenced by a desire for higher spending on teacher inputs, over and above their role in producing educational outputs. This desire could be due either to teacher power, or bureaucratic budget-maximizing behavior, or political patronage. The authors conclude by exploring the implications of these positive political models of educational spending behavior for various types of proposed educational reforms (localized control, parental participation, vouchers, and so on) which requires an examination of how the proposed reforms shift the relative powers of the stakeholders in the educational system: students and parents, educators, bureaucrats, and politicians.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 1795.

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Date of creation: 31 Jul 1997
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Handle: RePEc:wbk:wbrwps:1795
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  1. Eric A. Hanushek, . "Interpreting Recent Research on Schooling in Developing Countries," Wallis Working Papers WP3, University of Rochester - Wallis Institute of Political Economy.
  2. Jerik Hanushek & Dennis Kimko, 2006. "Schooling, Labor-force Quality, and the Growth of Nations," Educational Studies, Higher School of Economics, issue 1, pages 154-193.
  3. Caroline Minter Hoxby, 1994. "Does Competition Among Public Schools Benefit Students and Taxpayers?," NBER Working Papers 4979, National Bureau of Economic Research, Inc.
  4. Alderman, Harold & Orazem, Peter & Paterno, Elizabeth M., 2001. "School Quality, School Cost, and the Public/Private School Choices of Low-Income Households in Pakistan," Staff General Research Papers 1970, Iowa State University, Department of Economics.
  5. David Card & Alan Krueger, 1996. "School Resources and Student Outcomes: An Overview of the Literature and New Evidence from North and South Carolina," Working Papers 745, Princeton University, Department of Economics, Industrial Relations Section..
  6. Binswanger, Hans P. & Deininger, Klaus & Feder, Gershon, 1993. "Power, distortions, revolt, and reform in agricultural land relations," Policy Research Working Paper Series 1164, The World Bank.
  7. Tan, Jee-Peng & Lane, Julia & Coustere, Paul, 1997. "Putting Inputs to Work in Elementary Schools: What Can Be Done in the Philippines?," Economic Development and Cultural Change, University of Chicago Press, vol. 45(4), pages 857-79, July.
  8. Edwards, Alejandra Cox, 1989. "Understanding differences in wages relative to income per capita: The case of teachers' salaries," Economics of Education Review, Elsevier, vol. 8(2), pages 197-203, April.
  9. Hanushek, E.A. & Lavy, V., 1995. "School Quality, Acheivement Bias, and Dropout Behavoiir in Egypt," Papers 107, World Bank - Living Standards Measurement.
  10. Jimenez, E. & Lockheed, M.E., 1995. "Public and Private Secondary Education in Developing Countries. A Comparative Study," World Bank - Discussion Papers 309, World Bank.
  11. Jimenez, Emmanuel & Paqueo, Vicente, 1996. "Do local contributions affect the efficiency of public primary schools?," Economics of Education Review, Elsevier, vol. 15(4), pages 377-386, October.
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