EDUCATION FINANCING

Our education financing portfolio examines what happens when you alleviate financial constraints that schools may face. Schools need resources to implement innovations, yet a major constraint for public and private schools in Pakistan is a lack of adequate resources. In public schools, principals have limited access to resources to address their schools’ needs. In private schools, owners are limited by their schools’ revenues. Alleviating these resource and financing constraints helps schools to address their specific needs, thus improving quality.

  Read the Summaries or Take a Deeper Dive

classroom of young Pakistani private school girls sitting on three rows of benches

Grants to Private Schools

Image: Evidence for Policy Design

The grants to private schools paper shows the immense potential of financing in improving learning outcomes, although only under the right market conditions, where grants foster rather than stifle competition.

    • What is the school and student level impact of unconditional cash grants to low cost private schools?

    • Does the local market structure matter in determining impact?

    • When only one private school in a village receives the grant, school revenues increase.

    • But when all private schools in a village receive the grant revenues and quality both increase.

four Pakistani adults sitting around the table and talking

Loans to Private Schools

Image: Evidence for Policy Design

In this ongoing study exploring the impact of loans, we explore whether we can replicate the positive impact of unconditional grants in a financially sustainable and marketable way.

    • Can financially sustainable loan products achieve impact similar to grants?

    • Does pairing financing with education support services (ESS) encourage investments in "soft" infrastructure?

    • Loans to private schools are financially sustainable - almost all school owners repaid the loan.

    • Financing appears to help prevent closure for some schools.

classroom of high school age Pakistani girls wearing red uniforms sitting in rows of desks looking ahead at a blackboard

Grants to Public Schools

Image: Hashoo Foundation

Our ongoing work with public schools explores the impact of grants in a more constrained environment, where schools may not be as free to react to cash inflows as in the private school market.

    • What is the impact of unconditional cash grants to public schools in an area with substantial school choice?

    • Does the broader education market, including local private schools, also react?

    • Test scores in public schools increased.

    • But they also increased in nearby private schools!

    • The closer the private school the larger the effects on test scores.