The Efficiency of Education Expenditure in Portugal

An Analytical Framework

Author: Mr. Benedict J. Clements

This paper assesses the efficiency of education expenditure in Portugal and delineates a possible agenda for reform. Portugal's low educational performance has coincided with the highest level of primary and secondary education expenditure to GDP in the Organization for Economic Cooperation and Development (OECD), suggesting considerable inefficiency. Empirical results from the application of a nonparametric technique for production frontier estimation (Free Disposable Hull analysis) support this view. Among the reforms that could be considered to raise educational efficiency are the adoption of a goal-oriented management and incentive system; establishment of minimum student/teacher ratios; and an easing of employment and work rules governing public school teachers.

Volume/Issue: Volume 1999 Issue 179

Publication date: December 1999

ISBN: 9781451859010

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Business and Economics , Social Science , Public Finance , Demography , WP , teacher ratio , secondary education , OECD country , public school , alternative curricula , efficiency score , primary education , Fiscal Policy , Education , Free Disposable Hull Production Frontiers , Portugal , student ratio , dropout rate , teacher salary , student population , number of student , Education spending , Aging , Public expenditure review , Europe

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Summary

This paper assesses the efficiency of education expenditure in Portugal and delineates a possible agenda for reform. Portugal’s low educational performance has coincided with the highest level of primary and secondary education expenditure to GDP in the Organization for Economic Cooperation and Development (OECD), suggesting considerable inefficiency. Empirical results from the application of a nonparametric technique for production frontier estimation (Free Disposable Hull analysis) support this view. Among the reforms that could be considered to raise educational efficiency are the adoption of a goal-oriented management and incentive system; establishment of minimum student/teacher ratios; and an easing of employment and work rules governing public school teachers.