Ram-da,
If I understood correctly you want to know why the education expenditure needs to be pegged to a country's GDP and not be independently ascertained.
I would say that it is just a benchmark about how much a country's is spending. Generally countries do not take the GDP into account while determining the education budget - I think. Some countries - like Saudi Arabia and Zimbabwe ( I did an internet search) spend much more - between 15 to 40% of their GDP on education alone. Saudi Arabia has very less population and no defense requirements - so can afford to do so.
However, if the country in question is able to show that it needs to spend a much larger amount and is willing to undertake such projects but lacks money and latest technical knowhow - then international agencies such as World Bank , UNESCO have given commitment that they promise to arrange such financial and technical help -- from international donor countries etc.
So it is not just a matter of a country's GDP but also a country's WILL in improving its education -- money etc for it can be arranged (atleast in theory and rhetoric) from international sources.
Once again Education budget makers do not look at the GDP to determine their budgets.
I hope it was useful.
Umesh
Ram Sarangapani <[EMAIL PROTECTED]> wrote:
Ram Sarangapani <[EMAIL PROTECTED]> wrote:
HI Umesh
Thanks again for outlining the methodology. I am sure the UNESCO has
its reasons for pegging the expenditure to the GDP. But my question
still remains:
What if a country or state is NOT able to achieve its intended GDP
goals? Countries frequently reassess/revise and project expected GDP
rates. In those situations, wouldn't the 'percent of GDP formula'
affect education expenditures, detrimentally. For one, the education
managers of a state would have to frequently change their budgets
because of revisions in projected GDPs.
Isn't it better to figure out what expenses would be required to for
education at a certain level, as opposed to setting a pre-determined
limit and then fitting the education model to those funds?
Again, I am just posing questions with no background in such research.
--Ram da
On 9/16/05, umesh sharma <[EMAIL PROTECTED]>wrote:
> Ram-da,
>
> Thank you for your comment. Unless someone asks a clarification it is
> difficult to identify what might be unclear -- since I was doing such an
> analysis for the first time - trying to combine my bachelors degree
> knowledge of Economics with what I have learnt in Edu. Policy Analysis
> masters program.
>
> I will add the methodolgy portion to the write up before submitting it for
> ASA Newsletter.
>
> Methodology:
>
> It is believed that any economy should spend atleast about 6% of its GDP on
> education . Every economy has limited resources so it is perhaps not
> possible for all economies to spend huge portions on everything. Thus, a
> figure of 6% of GDP has been arrived at by international consensus as a
> minimum requirement expenditure on education.
>
> USA spends 4.2 % of its GDP on school education and 2.6% on higher ed. In
> total USA spends about 6.8% of its GDP on education.
> http://nces.ed.gov/pubs98/98009.pdf USSR used to spnd 10%
> of its GDP on education but Russis now spends only 0.10%
> http://www.unesco.org/education/efa/know_sharing/grassroots_stories/russia.shtml
>
>
> India as a whole spends only 3.3% of its GDP on education. But even if it
> were to increase its spending to 6% of the GDP - will that be enough?? My
> calculations are to identify how much money needs to be spent to provide
> effective and efficient education to school kids in India and Assam state.
> My calculations show that India needs to spend about $100 Billion on
> education, with $66 Billion of it on school education alone. India currently
> spends only $13 Billion on Education overall.
>
> So the question is how rich should India be - to afford to have $100 Billion
> to spend on education - and run short on other priorities. With the current
> GDP of India - a $100 Billion expenditure on Education would be equivalent
> to about 22% of its GDP ($455 Billion).
>
> Thus, the question is what should be the GDP of India - to be able to spend
> $100 Billion -- as only 6% of their GDP. India needs to have 4 times its
> current GDP - i.e. $1700 Billion -- to be able to afford a $100 Billion
> Education expenditure. Similarly Assam needs to have 7 times its current
> State GDP to afford Good Quality School education for ALL school children.
>
> Pl. comment.
>
> Umesh
>
> Ram Sarangapani <[EMAIL PROTECTED]>wrote:
> Umesh,
>
> Thank you for that analyses. I am not sure if I undersatnd all of it,
> but I have a question
>
> >Optimally 6% of GDP should be spent on Education
>
> How does this optimality arrived at? I mean why is it pegged to the
> GDP of Assam. I can visualize a scenario where (if) the GDP for Assam
> were to come down, then this optimal you indicate would also come
> down.
> Would it still be optimal spending on education?
> Some netter should be able to tell us how this optimal spending for
> education (or anything else) is calculated: On GDP, on the budget, or
> just on what is required to be spent on education for a perceived
> level of excellence.
> IMHO, once a predetermined goal for education is set, the Govt. will
> have to find the funds to meet the goal or at least a percent of it.
> Maybe others could weigh in.
> Interesting though. Once again Umesh thats a good start.
>
> --Ram da
>
>
>
> On 9/15/05, umesh sharma wrote:
> >
> >
> >
> >
> >
> >
> >
> > Calculation of Assam's Optimal School Edu. Spending
> >
> > and Optimal State GDP
> >
> >
> >
> > Assam's population = 26 million
> >
> > Assam's school age population = 8 million (30% of total)
> >
> > Assam's current Edu spending =$100 million per annum*
> >
> >
> >
> > [* Rs 400 per school kid per annum or $8 per kid per annum ( Rs 199 per
> primary school kid per annum (in 1995-96 at 1998 prices) or $64 million per
> annum for Assam School education or $100 million on Assam's Education incl
> 50% more for higher ed.]
> >
> >
> >
> > Expenditure for Effective Edu. Per school kid = $220 per annum.
> >
> > For Assam Effective School Expenditure = $220 * 8 million = $1.75 Billion
> >
> >
> >
> >
> > Optimal Total Edu. Spending =
> >
> > $1.75 Billion for school ed.
> >
> > + $.9 Billion for Higher Ed (50% of school spending)
> >
> >
> > Total Optimal Edu. Spending needed = $2.65 Billion per annum
> >
> >
> >
> >
> > So Assam needs to increase its Education spending by 26 times from current
> meager $100 million per annum to $2.65 Billion per annum.
> >
> >
> >
> > Optimal GDP for Assam extrapolating:
> >
> >
> >
> > Assam's State GDP currently = $ Rs 35,000 crore = $ 7 Billion
> >
> >
> >
> > Optimally 6% of GDP should be spent on Education.
> >
> > Current spending but if Optimal Edu. Spending is $2.65 Billion, then it
> would be 6% of a State GDP of $45 Billion!!
> >
> >
> >
> > So Assam's GDP should be 7 times of its current level (at current prices)
> to have quality education. It should be $45 Billion and NOT just $7 Billion
> as currently is. And then its Total education Spending should increase by 26
> times to be Atleast $2.65 billion , with $1.75 Billion to be spent on School
> Education alone atleast. Extra amount to be needed to improve supervision,
> in-service teacher training etc as pointed out earlier.
> >
> >
> >
> > If any errors please point out.
> >
> >
> >
> > Umesh
> >
> > College Park,
> >
> > Maryland, USA.
> >
> > (857) 928 0174 (cell)
> >
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