Government spending and school enrolment in sub-Saharan Africa: A system GMM approach

Government spending and school enrolment in sub-Saharan Africa: A system GMM approach

Author by Dr. Daniel Babalola

Journal/Publisher: Journal Of Economics And Management

Volume/Edition: 40

Language: English

Pages: 91 - 108

Abstract

Aim/purpose – Provision of basic education is pertinent to human capital development, poverty alleviation and abating the threat of insurgence in Africa. Governments in different countries in sub-Saharan Africa (SSA) do budget and spend various amount of money on education every year, but little is known about the effect of such spending on education, especially primary school enrolment which forms the basic educational foundation.

Design/methodology/approach – Using data for 24 countries from 2000 to 2016, this study assesses the effect of government educational spending on primary school enrolment in SSA by employing the System-GMM approach.

Findings – The results show that government spending has significant (p ? 0.05) and positive effect on primary school enrolment in SSA. The results are further confirmed using different diagnostic tests which include the Arellano–Bond test for first and second order autocorrelation in the disturbance term and the Hansen J-test for the validity of the instrumental variables. Other variables analysed (control), which have positive influence on enrolment, include GDP, general number of teachers available, and percentage trained teachers. Population growth rate negatively influences enrolment.

Research implications/limitations – The study therefore concludes that increasing spending on education by governments in SSA is sine qua non for improving primary school enrolment rate in the region.

Originality/value/contribution – This study has contributed empirically and theoretically to the body of knowledge. The scope covered also makes the study uniquely robust and different from previous ones, though scanty, country-based assessments.


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