Public Spending on Education and Learning Outcomes in Senegal

In the past two decades, Senegal has made great strides towards the achievement of universal basic education. However, education opportunities remain unequal partly because of skewed allocation of education resources. Furthermore, poor teacher quality with inefficient use of public funding for education tend to compromise the effectiveness of programs to expand access and improve learning outcomes. The paper uses the Autoregressive Distributed Lag Cointegration approach introduced by Pesaran and Shin to examine the impact of education spending on primary education outcomes in Senegal. The Autoregressive Distributed Lag Bound testing methodology has attractive advantage over the Johansen cointegration approach and does not require all variables to be integrated of order one and can be estimated if the variables are of different order of integration. The method also estimates both short term and long-term relationships among the variables of the model without testing for the presence of unit roots in the data generating process. The estimated results based on time series data for 1971-2018 indicate that the logarithms of primary completion rate, income, enrollment rate, public expenditures on education, and pupil-teacher ratio are cointegrated and thus have a long-run relationship. Estimates of the long-run model show that with the exception of public expenditures on education, the rest of the variables have significant effects on primary completion rate and with the expected signs. The estimated coefficients of the short-run error correction model are significant for all the explanatory variables. The error correction term has the expected negative sign and is robustly strongly. The speed of adjustment is quite high (-2.472), suggesting an easy correction of any disequilibrium. The plots of CUSUM and CUSUM squares are consistent with the estimated coefficient of the ARDL model. The Senegalese government need to continue vigorously to promote the current policy and improve the quality of instruction in primary schools; as well as promote equity and fairness in the distribution of education funding and other education resources. Improving teacher quality is key in increasing completion rates and reducing repetitions with dropout rates. A government poverty alleviation and income-generating program can substantially encourage parents to enroll their children.