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Historically, the World Bank has been the largest external financier of education in the world, committing a peak amount of just over $5 billion in Fiscal Year (FY) 2010 through both its Education Sector projects and multisector projects managed by other sectors (World Bank, 2010b). The World Bank also hosts the Education for All-Fast Track Initiative (EFA FTI). Launched in 2002, EFA FTI is a partnership of governments, civil society organizations, and multilateral agencies such as United Nations Educational, Scientific and Cultural Organization (UNESCO) and the World Bank, which provides grant funding and technical assistance to implement the basic education components of national education strategies. By providing significant funding for education in low-income countries (LICs) through its own International Development Association (IDA) and by managing the majority of EFA FTI grant funding, the World Bank has a major impact on the direction of education development around the world.

In 2011 the Bank released a new Education Sector Strategy, Learning for All, which sets out the World Bank Education Sector's approach to education development over the coming decade. The analysis in this chapter examines the role of the EFA FTI and the growth of World Bank education operations managed outside the World Bank Education Sector, as well as their influence on Bank education lending objectives in sub-Saharan Africa. We examine trends in World Bank and EFA FTI basic education financing in sub-Saharan African countries that have joined the EFA FTI partnership to compare these two sources of financing for primary education and analyze the extent to which the World Bank is substituting its primary education lending with grants from the EFA FTI. We also assess the results frameworks of 10 multisector operations managed by noneducation sectors (Economic Management and Poverty Reduction; Urban Development; Rural Sector; Population, Health, and Nutrition; and Social Protection) to ascertain the extent to which they include education objectives and indicators. The chapter focuses its research around two questions:1.Is there evidence that financing from the EFA FTI is substituting World Bank financing for education in sub-Saharan Africa?2.Are World Bank multisector operations well designed to achieve education objectives in sub-Saharan Africa?

The research finds that the EFA FTI has almost certainly impacted the demand for IDA financing for basic education development. The comparison of IDA and EFA FTI primary education financing shows country-level substitution is occurring in a number of sub-Saharan African countries, with at least 13 out of 18 EFA FTI grant recipients in sub-Saharan Africa receiving a declining share of IDA financing for primary education since joining the EFA FTI.

Second, multisector operations now account for one-third of Bank education lending and have increased to comprise half of all new education commitments in sub-Saharan Africa. The research finds that multisector operations with education components are not as effective or accountable for education outcomes as those managed by the Education Sector, unless they are explicitly linked to national education plans. Given the disconnect between Education Sector managed education lending, and financing for education managed by other Bank sectors, it is unclear how the latter will be guided by the Bank's Education Sector Strategy, which will only apply to half of all Bank education lending for sub-Saharan Africa. Currently, there is no guarantee that both EFA FTI funding and noneducation sector managed lending will be measured against World Bank education strategy standards, and yet the Education Sector Strategy 2020 does little to address these challenges.

Does education affect economic outcomes, and if so, how? Does education finance interact with public policy? And how does education finance policy contribute to the development of a new strategic planning for the next generation, if at all? This chapter reviews recent conceptual and methodological developments in the field of economics and finance of education. The review covers these two major topics and is divided into three sections. First is an overview of the field, including current trends in economics of education in both developed and developing countries. This section incorporates themes such as returns to investment in education, costs of education, education and economic growth, and education market, choice, and incentives. The second section focuses on finance of education and current debates on equality, equity, and efficiency in educational finances. The third section presents summary and discussion. The discussion will bring to light the issues, challenges, opportunities, and future directions of the field. Where appropriate, examples and empirical evidence from both developing and developed countries are presented.

The purpose of this paper is to assess the channels of education financing as they exist currently in Iraq. It argues that the current model of financing is highly centralized and in order to encourage a school-based management and better school outcomes, there needs to be decentralization of financing. The paper considers block grants as a mechanism for decentralization and explores other country experiences in this area.

The paper opts for both an analytical and exploratory study of the financing channels in the education sector in Iraq based on both primary field-based surveys and secondary sources of information such as World Bank and UN documents. For understanding other country experience of school block grant provision, the paper reviews literature and attempts to find learnings for Iraq.

The paper provides a detailed insight into the service delivery modal and channels of education financing in Iraq across multiple tiers. It argues that the centralized model of education financing is one of the factors that contribute to weak school governance and school performance indicators. It explores the idea of school block grants as a model of decentralized financing and a review of other country experiences on provision of school block grants gives some interesting insights into what might work for Iraq.

Economic wars, sanctions and conflict have severely affected the country and as a consequence there are very limited data and information available and this has impacted the study. Furthermore, though the country has been liberated from ISIS, the peace is fragile and any research findings have to be seen in this background.

The paper does not stop at identifying the problem, i.e. centralization of financing but attempts to explore and provide a way to get around this in the form of provision of school block grants.

There are very few studies that explore the service delivery model and financing channels in the education sector in Iraq and therefore this paper should add value to any discussion on post-conflict reconstruction.

The purpose of this paper is to explore the connections between state education finance distribution models and student achievement. To date, lawsuits challenging the constitutionality of state finance systems have been heard in 45 states; the judicial interpretation of the requirement to provide equality of educational opportunity has led to changes in finance distribution models as well as the implementation of accountability policy.

The study included district level finance and achievement data from five states. Researchers reviewed the relevant judicial interpretation of the finance system, the accountability policy, and the finance distribution system. Next, researchers calculated the equity of both the finance distribution model and measures of student achievement. Finally, an equity ratio was developed and calculated to discern the degree to which state distribution models resulted in equitable measures of student achievement.

Findings reveal that no state has both an equitable system of finance and equitable measures of student achievement. The way that states define proficiency significantly impacts the percentage of students that reach proficiency. This impacts the provision of equality of opportunity.

Traditionally, the measurement of equity has only been applied to finance distribution systems. The authors of this paper have applied these concepts to measures of student achievement and aligned the two concepts with the equity ratio. Since states are charged with providing sufficient resources to enable students to reach proficiency, an understanding of the interaction between resources and achievement is a critical tool in analyzing the provision of equal opportunity.

In recent decades, the responsibility for the financing of compulsory education in rural China has rested with townships and villages which, with limited tax authority and uneven revenue capacity, increasingly relied on a plethora of arbitrarily imposed fees for funding. To reduce farmers’ fiscal burdens, in 2000, the central government installed a series of rural taxation reforms. Correspondingly, the central government shifted the administrative responsibilities of rural compulsory education to the county level in 2001, and implemented a series of policies to make up for the loss of revenues to education. Using a provincial-level dataset from 1998 to 2006, we examined whether and how the rural taxation reforms affected the adequacy and equity of compulsory education finance in China, addressing related theoretical and policy implications from the perspective of intergovernmental fiscal relations.

During the 1990s many states used budget surpluses to refinance public education and provide property tax relief. This paper uses a case study of Kansas to assess the sustainability of state-initiated property tax cuts. It finds that the cuts are not fully sustainable over time because of court and federal mandates that require additional spending on education, economic fluctuations that reduce the ability of state budgets to maintain a given share of education spending, and demands for local control to allow school districts to spend more or less than state-mandated levels. The paper also argues that the property tax is essential to economic efficiency and local control.

While there has been increasing interest in the impact of courtmandated education finance reform on school district efficiency, research on the subject is scant. Taking advantage of New Jersey Supreme Court cases that have altered the way in which state school aid is distributed, this paper examines the effect of changes in the education finance system on school district efficiency. Building on existing literature on public sector efficiency, a longitudinal data analysis based on two-stage DEA models reveals that courtmandated increases in state aid to a limited number of poor school districts decreased the districts' efficiency. Though these results should be interpreted with some caution, in particular, the limitation of DEA as an efficiency measure, they imply that, as with any policy, policy makers and courts should be aware of how policy changes affect local government behavior and that it is necessary to evaluate policy outcome taking into account both resources and performance.

This chapter sheds light on long-term trends in the level and structural dynamics of investments in Russian human capital formation from government, corporations, and households. It contributes to the literature discussing theoretical issues and empirical patterns of modernization, human development, as well as the transition from a centralized to a market economy. The empirical evidence is based on extensive utilization of the dataset introduced in Didenko, Földvári, and Van Leeuwen (2013). Our findings provide support for the view expressed in Gerschenkron (1962) that in late industrializers the government tended to substitute for the lack of capital and infrastructure by direct interventions. At least from the late nineteenth century the central government's and local authorities' budgets played the primary role. However, the role of nongovernment sources increased significantly since the mid-1950s, i.e., after the crucial breakthrough to an industrial society had been made. During the transition to a market economy in the 1990s and 2000s the level of government contributions decreased somewhat in education, and more significantly in research and development, but its share in overall financing expanded. In education corporate funds were largely replaced by those from households. In health care, Russia is characterized by an increasing share of out-of-pocket payments of households and slow development of organized forms of nonstate financing. These trends reinforce obstacles to Russia's future transition, as regards institutional change toward a more significant and sound role of the corporate sector in such branches as R&D, health care, and, to a lesser extent, education.

The purpose of this paper is to investigate how the effects of 8Ps of services marketing affect students’ selection of self-financing sub-degree programmes in Hong Kong. The factors that affect students’ selection of self-financing sub-degree programmes have not been studied in higher education market of Hong Kong. This research is to fill the gap by examining the effects of 8Ps (“Product Elements”, “Price and Other User Outlays”, “Place and Time”, “Promotion and Education”, “People”, “Process”, “Physical Environment” and “Productivity and Quality”) on self-financing sub-degree programmes in Hong Kong.

The research taken was a quantitative survey of students at Community College at Lingnan University in Hong Kong.

The results reveal that “Productivity and Quality” is the most important element of 8Ps of services marketing. Accreditation of programmes seeking recognition in Hong Kong and overseas can increase student enrolment. “Promotion and Education” element is the least important element of 8Ps of services marketing. Self-financed higher education institutions should develop strategies to build relationships with the secondary school teachers and counsellors rather than invest money on advertising.

The data were collected from a particular community college in Hong Kong only.

Management can increase student recruitment by allocating minimum amount of limited resources to recruit maximum number of students.

This research adds knowledge to the marketing of higher education in Hong Kong. The management of self-financing sub-degree programmes can use the findings of this research as a reference to develop their marketing strategies.

Based on government data from 1993 to 2008, this chapter aims to compute and analyze the trends of inequity in interprovincial and regional per-student spending in China's compulsory education, and to ascertain the potential impact of changes in education financing policies. Appropriate inequity measures (Gini and Theil index and Gini decomposition, among others) are employed to provide a systematic picture of the trends. Main findings include: (1) all inequity measures show large and overall increased disparities among provinces and among regions, between 1993 and 2008. (2) However, a slight drop of spending inequity is observed at the primary education level around 2002 and a larger reduction in 2005 and on. There are more turning points in the trend of lower-secondary per-student spending among provinces. These patterns are consistent across different inequity measures and spending indicators (per-student total spending, per-student recurrent spending, and per-student nonpersonnel spending). (3) The trend toward more balanced resource allocation around 2002 and 2005 could be the impact from the Reform of Tax and Administrative Charges and the New Mechanism for Financing Rural Compulsory Education. An increased share of budgetary expenditure in determining total spending suggests that equalizing financing policies have the potential to induce a significant reduction in spending inequity. These findings may help policy makers to better understand and alter the extent of spending inequity in compulsory education. This is an original empirical study that systematically derives the spending inequity trends over a long period in China's compulsory education.