Borrowing Constraints and Demand for Remedial Education: Evidence from Tanzania

Konrad Burchardi, Jonathan de Quidt, Selim Gulesci and Munshi Sulaiman

The Economic Journal, 2024, vol. 134, issue 662, 2621-2637

Abstract: We use a cash transfer to relax households’ borrowing constraints, then elicit their willingness to pay for a remedial education programme offering tutoring and life skills training. Lottery losers were willing to pay 3,300 Tanzanian Shillings for the programme, which is 7% of per capita monthly expenditures. For those identified at baseline as able to borrow, willingness to pay increases by 3% upon winning a lottery prize of 3,200 Tanzanian Shillings. For those unable to borrow, willingness to pay increases by 27% upon winning the lottery. We conclude that borrowing constraints limit access to educational programmes, and may increase inequality of educational attainment.

Date: 2024
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