Demand for Primary Schooling in Rural Mali: Should User Fees be Increased?

Abstract

This paper present estimates of the price elasticity of demand for primary schooling, using household and school survey data from rural Mali. The elasticity of enrolment with repect to the local shcool fee is compared with the effects on enrolment of distance to the school and various indicators of school quality, including books per classroom and the number of grades offered. Fees have a negative effect; however, certain improvements in school quality could easily offset in terms of enrolment any negative effect of higher fees to finance such improvements. For example, the astonishingly low average of two books per classroom could be doubled for a 10% increase in the fee; the point elasticity estimates indicate that the net effect on enrolment would be positive. The effects of fees on demand for public services in poor countries have been the subject of considerable attention for more than a decade, since the period of fiscal austerity and cuts in public expenditure programmes brought on by the adjustment programmes of the 1980s. The World Bank has advocated user fees for higher educaton (1986) and for selected health services, especially at the hospital level (1987), in poor countries, though generally with the caveat that fees should not be imposed on the poor. Analyses of data from Malawi, Peru and the Philippines have shown the potential benefits of fees for the expansion of primary and secondary school systems and of health services, taking into account the poor's ability and willingness to pay. A study in rural Cote d'Ivoire, however, suggests that user fees for medical care clinics would have regressive effects, reducing utilization of care of individuals in the bottom half of the income distribution, and reducing their welfare, while increasing the utilizaion of care and the welfare of those in the top half of the income distribution.