Debates over whether democracy or political clientelism would drive the politics of development in Africa have increasingly given way to more nuanced readings that seek to capture the dynamic interplay of these forms of politics. However, most current analyses struggle to identify the specific causal mechanisms through which politics shapes the actual distribution of resources. A political settlements approach, which emphasizes the distribution of ‘holding power’ – the ability to engage and survive in political struggles – within ruling coalitions, and how this shapes institutional functioning, can bring greater clarity to these debates. Our analysis shows that patterns of resource allocation within Ghana's education sector during 1993–2008 were closely shaped by the incentives generated by Ghana's competitive clientelistic political settlement, which overrode rhetorical concerns with national unity and inclusive development. This had particularly negative implications for the poorest northern regions, which have lacked holding power within successive ruling coalitions.