Expanding education to reduce poverty: public and private provision

The age structure of population in developing countries implies that more than half the population is aged less than 24. How these young people can be given access to an education which enables them to find jobs is an important policy issue. At what level the educational system should be expanded is not at all clear. The most striking empirical finding regarding the economic return to education in sub-Saharan Africa is that it appears to be strongly convex implying that the returns are higher at higher levels. In some countries both the returns and the degree of convexity are substantial. These findings are crucial for the policy issue as to how the expansion of education will impact on both poverty and inequality.

The research, which is being conducted in Ghana, will inform an evaluation of two closely related policy questions. The first is how any expansion of education should be effected, i.e. the rates at which it should be expanded at various levels. The second is how this expansion should be funded, and whether policy should seek to influence the divide between the public and the private sector.