Is Public Expenditure on Primary Education Effective? Evidence from Districts Across India

Abstract

Against the background of international commitment to the Millennium Development Goal (MDGs) for the universalization of primary education, this paper investigates the effectiveness of public spending on primary education outcomes in 115 districts across three states in India – Uttar Pradesh, Andhra Pradesh and Karnataka. Controlling for factors including per capita income, student-teacher ratio, and ratio of government to private primary schools, we find that primary educational spending has a negligible impact on enrollment rates, primary school transition rates, and performance of students on exams. Instead, districts with greater proportions of private primary schools are found to have consistently better outcomes. Higher per capita income is also correlated with some improved performance measures. Reducing the student-teacher ratio has no effect, a phenomenon possibly explained by rampant teacher absenteeism and lack of teacher motivation. Evidence from this study indicates that policymakers should seek alternatives to improve the quality of primary education, and determine how to achieve a more efficient and equitable allocation of educational funds.