While a number of benefit incidence studies of public expenditures have been carried out for African countries, there are very few studies that look at how the incidence of such expenditures has been changing over time. We analyze three rounds of nation-wide household surveys in Madagascar over the 1990s, a period of weak economic growth but significant changes in social sector organization and budgets. Education and health services for the most are distributed more equally than household expenditures, hence they serve to redistribute welfare from the rich to the poor. By stricter standards of progressivity, however, public services do poorly. Few services other than primary schooling accrue disproportionately to the poor in absolute terms. When further adjusted for differences in the numbers of potential beneficiaries in different expenditure quintiles (e.g., school-age children), none of the education or health benefits considered appear to target the poor while several target the non-poor. With regard to changes over the decade, however, primary enrollments not only rose sharply but also became significantly more progressive; since the country experienced little or no growth in household incomes during the period, this reflects supply rather than demand side factors. The improvement in equity in public schooling occurred in part because the enrollment growth was in effect regionally targeted: it occurred only in rural areas, which are poorer.3
for their comments on this report or on the issues raised by it. The study has also benefited from discussions with Jee-Peng Tan of the World Bank on recent trends in school enrollments, and from comments from participants at a seminar on the findings given at USAID Madagascar. In addition to their substantive input, Bart Minten and Jean Razafindravonona provided valuable logistical support for this study. Finally, we thank USAID Madagascar for funding this work through the Ilo project.ii Abstract While a number of benefit incidence studies of public expenditures have been carried out for African countries, there are very few studies that look at how the incidence of such expenditures has been changing over time. We use three rounds of nation-wide household surveys to analyze the distribution of public expenditures on education and health services in Madagascar over the decade of the 90s, a period of little economic growth but significant changes in social sector organization and budgets.Education and health services for the most part are found to be distributed more equally than household expenditures: therefore they serve to redistribute welfare from the rich to the poor. By stricter standards of progressivity, however, public services do poorly. Few services other than primary schooling accrue disproportionately to the poor in absolute terms. When we further adjust for differences in the numbers of potential beneficiaries in different expenditure quintiles (e.g., school-age children in the case of education), none of the education or health benefits considered appear to target the poor while several target the non-poor. We also find significant disparities in the use of services between rural and urban areas, and by province. On the other hand, for both education and health services, no notable gender differences exist in coverage.With regard to changes over the decade, primary enrollments rose sharply and also become significantly more progressive; since the country experienced little or no growth in household incomes during the period, this apparently reflects supply rather than demand side factors. The improvement in equity in public schooling occurred in part because the enrollment growth was in effect regionally targeted: it occurred only in rural areas, which are poorer.iii
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