What is the link between education outcomes and public education expenditure? Are governments and donors spending enough on education to achieve the millennium development goals (MDGs)? How accurate are indicators used to measure progress towards Education for All (EFA)?

The Dakar World Education Forum in 2000 pledged to ensure that by 2015 all children – and particularly girls, children in difficult circumstances and those belonging to ethnic minorities – have access to free and compulsory primary education. Dakar recommended that developing countries increase the proportion of GNP spent on education from 3.9 per cent to 4.3 per cent. The amount of estimated additional resources required is between $9 and $28 billion.

A paper from the UK’s Institute of Development Studies explores the extent to which increasing the resources available to developing country education systems will lead to the achievement of the millennium development goals. Detailed cross-country analysis indicates that links between resources and educational indicators are weak and that achievement of the MDGs will require more than just increases in expenditure on primary education.

The study suggests:

• There is no clear-cut relationship between resources and education outcomes: some countries allocating less than their neighbours have good education outcomes, while elsewhere higher than average spending results in poorer outcomes.
• Larger pupil-teacher ratios are not necessarily associated with poorer test scores.
• Indicators selected to monitor EFA have no close, consistent relationship to levels of expenditure across countries.
• Outcome measures do not assess some important aspects of EFA.
• The impact of primary expenditure per pupil on primary enrolment rates is very small.
• Levels of household spending, the effectiveness of public expenditure control systems and the composition of public education spending are important factors explaining the weak link between spending and educational outcomes.

Monitoring the extent to which expenditure actually promotes education MDGs will require:

• improved capacity to monitor country progress, particularly in sub-Saharan Africa
• more research to produce reliable data which enables results to be compared
• gathering more cross-country information on household education spending – often comparable to levels of public spending per pupil
• ensuring that all actual education expenditure is included in analyses and that money allocated for education, but diverted for other uses, is excluded
• learning more about the effectiveness of public expenditure management systems
• identifying the vested interests within national education systems which determine how public education money is spent and which are responsible for inefficient allocations.

Source(s):
‘Achieving education for all: how much does money matter?’, IDS Working Paper 175, Institute of Development Studies, by S. Al-Samarrai, December 2002 Full document.

Funded by: Department for International Development, UK

id21 Research Highlight: 28 April, 2003

Further Information:
Samer Al-Samarrai
Institute of Development Studies
University of Sussex
Brighton
Sussex BNI 9RE
UK

Tel: +44 (0) 1273 606261
Fax: +44 (0) 1273 621202
Contact the contributor: s.al-samarrai@ids.ac.uk

Institute of Development Studies

Other related links:
'Free education at the expense of quality? Public education spending in Malawi'

'Achieving schooling for all – lessons in education spending'

'New solution? Can a sectoral approach to education meet international targets?'

'Planning and paying for Africa's educational future'

'Teacher Education in Malawi: matching supply and demand'

Eldis has a collection of online resources about the economics of education