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Rabbani - Education
- 1. Education in Haiti Atonu Rabbani Department of Economics, University of Dhaka Haiti Priorities Conference, Port Au Prince, 29/4-02/05
- 2. Education has a robust association with economic growth & development • Under 19 population in Haiti: 4.9m or 43%, a young country • Investing in skills for them can’t be ignored • Difficult to ascertain public finance of it, possibly on the lower side • Households face real constraints • Supply side interventions will also be important
- 3. 1st analyzed solution Early Childhood Education (ECE)
- 4. What ECE constitutes? • Human capital/skill formation starts early in life (“Heckman Equation”) • Education policy in Haiti also recognizes this • A regular classroom intervention for 4 and 5 year olds • In batches of 40 students with two trained educators with an assistant • Standard practices include cognitive stimulants (with toys and accessories) as well as social skills
- 5. Costs • Total cost for a center will be about USD 6,300/year • Or about USD 2017 $157 per child per year • Targeting 258 thousand children (= 50% of 4 and 5 year olds in Haiti) • Total cost = about USD 102m for a two-year program • Includes fixed costs of trainings, toys, accessories, curriculum development and also working costs of teachers’ salaries and rents • Also the cost of additional 0.61 year of schooling
- 6. Benefits • About 35 percent gain in income • Gain from 16 to 55 years • 2.7% annual real wage growth • Total discounted benefit: About 30 thousand USD • Possibly other non-market benefits (lower criminality, better health), so lower bound -200 0 200 400 600 800 1000 1200 1400 4 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 CostandBenefit,USD Cost Benefit
- 7. Benefit Cost Ratios (BCRs) for ECE • Benefits and costs figures are in billion LCUs Discount Benefit Cost BCR Quality of Evidence 3% 203.31 7.11 24.7 Strong5% 114.53 6.93 13.9 12% 22.96 6.41 2.6
- 8. 2nd analyzed solution Aiming Learning Outcomes
- 9. Aiming competency or learning outcomes • School attendance has reasonably increased during MDG era • Quality may be next frontier: a more difficult outcome to measure and address • A whole menu of choices are available: governance, computer-aided technology, teachers’ incentives and training, selection • Our focus: Tracking or teaching based on prior achievements
- 10. Costs • Targeting children who are in primary schools (grades 1 to 5 or 6 to 10 year olds) • A USD 100 intervention • Supplementary teaching by grouping students based on their achievements • Targeting 870 thousand children (= 70% of grades 1-5 year olds in Haiti) • Total cost = about USD 87m per year (the total cost can be less because not all students may need the intervention)
- 11. Benefits • Wage gain: • An impact of 1.97 SD in test scores • About 8.8% wage gain per SD achievement (Hanushek and Zhang, 2009) • Benchmark income of USD 128/month (from DHS 2012, inflation adjusted) • Accrued over 16 to 55 years • 2.7% annual real wage growth • Total discounted benefit: About 17 thousand USD -100 0 100 200 300 400 500 600 700 6 8 10 12 14 16 18 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 50 52 54 CostandBenefits,USD Cost Benefit
- 12. Benefit Cost Ratios (BCRs) for “Tracking” • Benefits and costs figures are in billion LCUs Discount Benefit Cost BCR Quality of Evidence 3% 401.93 27.76 12.2 Strong, but needs to be contextualized 5% 235.30 26.75 7.2 12% 53.67 23.76 1.6
- 13. 3rd analyzed solution Conditional Cash Transfer for Secondary Schooling
- 14. Addressing secondary school attendance with CCT • Many students drop out at the secondary level • Higher in the rural areas and among disadvantage groups • CCT has been tried in different contexts and is largely successful • Usually targeted towards low income households 0 10 20 30 40 50 60 70 80 90 100 6 7 8 9 10 SurvvialRates Grades
- 15. Costs • Targeting children who are in the secondary schools (grades 6 to 10 or 11 to 15 year olds) • Average CCT = 14% of consumption • Calibrated for Haiti: USD 121 per student per year • Household in the bottom two quintiles (coinciding with Haiti poverty level): 475 thousand students 0 10 20 30 40 50 60 70 80 90 100 6 7 8 9 10 SurvvialRates Grades Baseline Survival Rate Increased Survival Rate
- 16. Benefits • Over a five-year period, it adds another year of schooling. • Wage gain: • Calibrated for Haiti for lower secondary education: about USD 3,600 over life time -150 -100 -50 0 50 100 150 200 250 300 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 41 43 45 47 49 51 53 55 CostsandBenefits,USD Cost Benefit
- 17. Benefit Cost Ratios (BCRs) for CCT • Benefits and costs figures are in billion LCUs Discount Benefit Cost BCR Quality of Evidence 3% 128.7 17.0 7.6 Strong5% 87.5 16.4 5.3 12% 35.6 14.7 2.4
- 19. BCRs for all three inventions 24.7 13.9 2.6 12.2 7.2 1.6 7.6 5.3 2.4 0 5 10 15 20 25 30 3% 5% 12% 3% 5% 12% 3% 5% 12% ECE Tracking CCT BCR
- 20. Thank you
Editor's Notes
- I really appreciate and want to thank Copenhagen Consensus Centre to make me part of the “Haiti Priorise” project. This is an important exercise and can provide guidance to allocate the limited resources to the best use based on evidence and the highest yield they can generate. I am really sorry for not being able to be there in person. The local consulate, it seems, is taking a more conservative approach in granting visitor visa lately, at least compared to the last time I faced it.
- Haiti has a young population with about 43 percent of the population below 19 years of age. Haiti can reap the benefit of this potential demographic dividend by focusing on education. Allocating resources through well informed public finance decision is important. This needs to take account of real constraints faced by households and supply-side intervention can ameliorate some of these constraints.
- I have evaluated three different education interventions as part of the Haiti Priorise. I have followed the principles that I followed for a very similar exercise I did as part of the Bangladeshi version of it. The main idea is education interventions have dynamic complementarity, basically suggesting that an investment earlier in life can increase returns on investment at a later time and can also reduce of acquiring skills at later stage. This is usually summarized as Heckman Equation. One implication of the skill formation process is that acquisition of skill needs to be an ongoing process, which national development programs should take into consideration.
- First I focus on early childhood education. This is consistent with the dynamic complementarity I have mentioned before. The education policy in Haiti also recognizes this. Psychosocial stimulant has particularly been useful in many different contexts, including both developing and developed countries. Such interventions can further mitigate the deficiency that can result from other factor such as lack of nutrition. Here I have proposed an intervention for 4 and 5 year old children in Haiti. This is a facility based intervention for 2 hours/day and five days per week, involving both cognitive and non-cognitive stimulations and psycho-social skills. This usually requires two persons with a helper with age appropriate tools and toys.
- Such intervention can cost up to 6,300 USD/year or about 157 dollar per student per year. With a reasonable target of about 50% of the targeted age group (i.e. about 258 thousand children), the total cost of the program will amount to 102 million dollar for two years. Such intervention can also increase 0.61 additional year of schooling at the later stage, the cost of which is also factored in.
- Such intervention can have a long term return of 30 percent increase in income, which starts accruing at the age of 16 until 55 years (as you can see in the chart). The total discounted value can amount to about 30 thousand dollar over the lifetime. There may be other non-market benefits such as lower criminality and higher health outcomes, so the estimate is possibly a lower bound.
- The comparison of benefit and cost suggests benefit-cost ratio of about 14 at a discount rate of 5 percent. The quality of evidence is quite strong for effectiveness of ECE interventions.
- Next I want to draw attention to enhancing competency or learning outcomes. MDG era has largely been successful in bringing children to schools and attendance and enrolment have largely increased. It may be more important now to address learning outcomes. The literature is rife with many different types of interventions such as computer aided teaching, teachers’ incentives and training and supplementary teaching based on prior achievement. Here we focus on the last one. Here I propose what is known as “teaching at the right level” or tracking. This requires supplementary teaching for children based on their prior achievements. A more homogeneous class can allow teachers to have more tailored pedagogy and attention benefiting the child. This has been tried in a number of places (e.g. India and the Philippines). Haiti has been successful in increasing enrolment at grades 1 to 5 (the first phase of primary schooling). The non-continuation beyond 5th grade may be because of lack of competency or learning outcomes. International policy documents such as SDGs also have focused on learning outcomes.
- The prior cost effective analyses suggest we can compare the effect of tracking for a 100 dollar spent. The intervention targets about 870 thousand students, about 70 percent of the total grade 1-5 students. They receive this intervention over five years.
- Measuring benefit requires further simulation. The intervention can have an impact of 1.97 SD in test scores. We use Hanushek and Zhang’s 8.8% wage again per SD in test score. Using a benchmark income of USD 128/month with benefit spanning 16 to 55 years, we get a total discounted benefit of about 17 thousand dollar.
- The benefit cost ratio amounts to a respectable 7.2 at 5% rate of discounting. However, it is possible that the intervention may require some more contextualization and other interventions aiming to boost learning outcomes may also be considered.
- In Haiti, just like many other developing countries, school dropout at the secondary level is an issue, as we see in the chart. Moreover, the drops out rates are also higher among more disadvantaged groups and rural areas. Hence, lowering drop rates can also have equity implication. I propose using conditional cash transfer to lower drop out rates. CCT is one of the most widely used programs to encourage households to send kids to schools. The average CCT is about 14% of average consumption level. That amounts to about 121 usd per student per year. CCTs are usually targeted based on some socioeconomic characteristics. For Haiti, CCTs can be used for bottom two income quintiles and this also coincides with the about 40% poverty rate of Haiti. This suggests about 475 thousand students in Haiti.
- The calculations suggest about an additional year of schooling and calibrating for income at the secondary level, we get a benefit of 3,600 dollar over lifetime.
- Comparing total benefit to total cost suggest a BCR of about 5.3.
- Lastly, we compare the BCRs for all three interventions and we find a declining BCR as timing of the education intervention advance over age, as perhaps would be suggested by Heckman Equation. Education interventions have the potential to be very effective in developing Haiti and set it on a better growth path.
- Thank you and best wishes for the Haiti Priorise program.