Explaining Leakage of Public Funds

Reinikka, Ritva ; Svensson, Jakob

World Bank, Washington, DC

关键词: AUTHORITY;    BROADCASTING;    BUDGET SYSTEM;    BUDGETARY ALLOCATIONS;    BUREAUCRACY;   

DOI  :  10.1596/1813-9450-2709
RP-ID  :  WPS2709

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

Using panel data from a unique survey ofpublic primary schools in Uganda, The authors assess thedegree of leakage of public funds in education. The surveydata reveal that on average during 1991-95 schools receivedonly 13 percent of the central government's allocationfor the schools' nonwage expenditures. Most of theallocated funds were used by public officials for purposesunrelated to education or captured for private gain(leakage). The survey data also reveal large variations inleakage across schools. A small set of school-specificvariables can explain a significant part of this variation.Specifically, the authors find that larger schools receive alarger share of the intended funds per student. Schools withchildren of wealthier parents also experience a lower degreeof leakage, while schools with a higher share of unqualifiedteachers receive less. After addressing potential selectionand measurement issues, the authors show that these schoolcharacteristics have a quantitatively large impact on thedegree of leakage. The findings are consistent with the viewthat resource flows-and leakage-are endogenous toschools' sociopolitical endowment. Rather than beingpassive recipients of flows from government, schools usetheir bargaining power relative to other parts of governmentto secure greater shares of funding. Public resources aretherefore not allocated according to the rules underlyingthe government's budget decisions, with obvious equityand efficiency implications. The survey findings had adirect impact on policy in Uganda. As evidence on the degreeof leakage became public knowledge, the central governmentenacted a number of changes: it began publishing monthlytransfers of public funds to the districts in newspapers,broadcasting them on radio, and requiring schools to postinformation on inflow of funds. An initial assessment ofthese reforms shows that the flow of funds improveddramatically, from 13 percent on average reaching schools in1991-95 to around 90 percent in 1999. These improvementsemphasize the role of information in mobilizing"voice" for better public expenditure outcomes.