The fiscal cost of weak governance: evidence from teacher absence in India

Karthik Muralidharan, Jishnu Das, Alaka Holla and Aakash Mohpal

No 7579, Policy Research Working Paper Series from The World Bank

Abstract: The relative return to input-augmentation versus inefficiency-reduction strategies for improving education system performance is a key open question for education policy in low-income countries. Using a new nationally-representative panel dataset of schools across 1297 villages in India, this paper shows that the large investments over the past decade have led to substantial improvements in input-based measures of school quality, but only a modest reduction in inefficiency as measured by teacher absence. In the data, 23.6 percent of teachers were absent during unannounced visits with an associated fiscal cost of $1.5 billion/year. There are two robust correlations in the nationally-representative panel data that corroborate findings from smaller-scale experiments. First, reductions in student-teacher ratios are correlated with increased teacher absence. Second, increases in the frequency of school monitoring are strongly correlated with lower teacher absence. Simulations using these results suggest that investing in better governance by increasing the frequency of monitoring could be over ten times more cost effective at increasing teacher-student contact time (net of teacher absence) than hiring more teachers. Thus, at current margins, policies that decrease the inefficiency of public spending in India are likely to yield substantially higher returns than those that augment inputs.

Keywords: Educational Institutions&Facilities; Effective Schools and Teachers; Educational Sciences (search for similar items in EconPapers)
Date: 2016-02-25
New Economics Papers: this item is included in nep-dev, nep-edu and nep-ure
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Related works:
Journal Article: The fiscal cost of weak governance: Evidence from teacher absence in India (2017)
Working Paper: The Fiscal Cost of Weak Governance: Evidence from Teacher Absence in India (2014)
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