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Trends in private sector development in World Bank education projects

  • Sosale, Shobhana
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    Emerging trends in education show the private sector to be playing an increasingly important role in financing and providing educational services in many countries. Private sector development has not arisen primarily through public policy design, but has of course been affected by the design, and limitations of public policy. The author traces trends in private sector development in eleven of seventy World Bank education projects in 1995-97, asking two questions: What has been the rationale for Bank lending in education? And, in countries where there is both privately financed, and publicly financed, and provided education, how has the Bank encouraged the private sector to thrive? The eleven country samples reveal that the Bank's interest in private sector development is basically in capacity-oriented privatization, to absorb excess demand for education. This is crucial to the Bank's general strategy for education lending: promoting access with equity, focusing on efficiency in resource allocation, promoting quality, and supporting capacity building. Absorbing excess demand tends to involve poorer families, usually much poorer than those that take advantage of other forms of privatized education. The Bank emphasizes capacity-oriented privatization, especially of teacher training for primary, and secondary schools, as well as institutional capacity building for tertiary, and vocational education. The underlying principle is that strengthening the private sector's role in non-compulsory education over time, will release public resources for the compulsory (primary) level. The private sector is emerging as a force governments, donors, and other technical assistance agencies cannot ignore. Often the term private sector encompasses households'out-of-pocket expenses, rather than describing for-profit, or not-for-profit (religious or otherwise) sectors. And lumpy investments, supporting both private, and public education, are the norm.

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    Paper provided by The World Bank in its series Policy Research Working Paper Series with number 2452.

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    Date of creation: 30 Sep 2000
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    Handle: RePEc:wbk:wbrwps:2452
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    1. Psacharopoulos, George, 1993. "Returns to investment in education : a global update," Policy Research Working Paper Series 1067, The World Bank.
    2. Chambers, Jay G., 1985. "Patterns of compensation of public and private school teachers," Economics of Education Review, Elsevier, vol. 4(4), pages 291-310, August.
    3. Romer, Paul M, 1986. "Increasing Returns and Long-run Growth," Journal of Political Economy, University of Chicago Press, vol. 94(5), pages 1002-37, October.
    4. Jimenez, Emmanuel & Lockheed, Marlaine E. & Luna, Eduardo & Paqueo, Vicente, 1989. "School effects and costs for private and public schools in the Dominican Republic," Policy Research Working Paper Series 288, The World Bank.
    5. Harold Alderman & Peter F. Orazem & Elizabeth M. Paterno, 2001. "School Quality, School Cost, and the Public/Private School Choices of Low-Income Households in Pakistan," Journal of Human Resources, University of Wisconsin Press, vol. 36(2), pages 304-326.
    6. Christopher Colclough, 1993. "Education and the Market: Which parts of the neo-liberal solution are correct?," Innocenti Occasional Papers, Economic Policy Series iopeps93/2, UNICEF Innocenti Research Centre.
    7. Jimenez, E. & Lockheed, M.E., 1995. "Public and Private Secondary Education in Developing Countries. A Comparative Study," World Bank - Discussion Papers 309, World Bank.
    8. Glomm, Gerhard, 1997. "Parental choice of human capital investment," Journal of Development Economics, Elsevier, vol. 53(1), pages 99-114, June.
    9. West, Edwin G., 1991. "Public schools and excess burdens," Economics of Education Review, Elsevier, vol. 10(2), pages 159-169, June.
    10. Psacharopoulos, George & Arieira, Carlos R. & Mattson, Robert, 1997. "Private education in a poor country: The case of urban Bolivia," Economics of Education Review, Elsevier, vol. 16(4), pages 395-406, October.
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