The redistributive impact of government spending on education and health: Evidence from thirteen developing countries in the commitment to equity project

Produced by: 
Tulane University
Available from: 
March 2015
Paper author(s): 
Nora Lustig
Topic: 
Education - Health
Politics and Economy
Year: 
2016

Here, I examine the level, redistributive impact and pro-poorness of government spending on education and health for thirteen developing countries from the Commitment to Equity project. Social spending as a share of total income is high by historical standards, and it rises with income per capita and income inequality. Spending on education and health lowers inequality and its marginal contribution to the overall decline in inequality is, on average, 69 percent. There appears to be no “Robin Hood Paradox:” redistribution increases with income inequality, even if one controls for per capita income. Concentration coefficients indicate that spending on pre-school, primary and secondary education is pro-poor in twelve countries. Spending on tertiary education is regressive and unequalizing in three countries, and progressive and equalizing (but not pro-poor) in ten. Health spending is pro-poor in five countries. Of the remaining eight, health spending per capita is roughly equal across the income distribution in three, and progressive and equalizing (but not pro-poor) in five.

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