Equitable or Inequitable Finance?

Type Working Paper
Title Equitable or Inequitable Finance?
Publication (Day/Month/Year) 2011
URL http://r4d.org/sites/resultsfordevelopment.org/files/BurnettJayaram_SalzburgGlobalSeminar.pdf
Promoting educational equity is key to spurring economic growth and optimizing talent. However, serious educational inequities in
both enrollment and learning remain in developing countries, and are a result of differentials in income, gender, class and caste, ethnic
and linguistic barriers, geography and disabilities. Total global spending on education is around $2.5 trillion a year, with about $2.0
trillion coming from public expenditure, about $500 billion from private sources and only about $12 billion from aid. Despite this, the
global financing gap for basic education in low income countries is around $23 billion. Public spending on education in developing
countries is skewed towards the top quintile, with disparities greatest in low-income countries where the share of the bottom 20% is
only half that of the top 20% (UNESCO, 2008).
In order to strengthen equity, there should be more support for basic education and more targeting of education spending at all levels
on the lowest quintiles and disadvantaged groups. This will require more resources overall which can come from (i) increasing the
efficiency of current spending; (ii) reallocating resources from secondary and tertiary education towards basic education; and (iii)
using innovative financing mechanisms as the prospects for increased aid for education are not good. In addition to more resources,
government policies should be developed to better target the poor and disadvantaged; particularly effective mechanisms include early
childhood programs, conditional cash transfers, vouchers and scholarships for the poor, the abolition of primary school fees, and
remedial „catch-up? programs. Finally, accountability needs to be strengthened for achieving educational equity and for spending on
educational equity; this requires more data and more external monitoring, including by civil society

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