Is school funding unequal in latin america? A cross-country analysis of interregional disparities in public spending

Abstract

Education spending has increased significantly in Latin America, but less is known about how resources are distributed. Using original data, this study measures the inequality in per-pupil spending between regions with different levels of socioeconomic status within Brazil, Chile, Colombia, Ecuador, and Peru. We find that Brazil has the widest funding gap due to inequalities in local revenues between high-and low-socioeconomic-status regions. However, the country’s funding gap has narrowed over time. School funding in Colombia has become more regressive, but its gap is half the size of the gap in Brazil. The distribution of school funding in Peru has changed from being regressive to progressive. Education spending in Chile and in Ecuador is consistently progressive. However, while the progressiveness of funding in Ecuador is driven by transfers targeted at disadvantaged rural areas, the funding formulas in Chile address socioeconomic inequalities beyond the ruralurban gap.