Course title: Financing of Education

Course No: Ed. PM. 524 Full marks: 50

Nature of the course: Theory Pass marks: 20
Year: Second Time per periods: 55 min
Periods per week: 3
Total periods: 75

1. Course Description
This course on financing of education is basically linked with the school finance in terms of
the economics of education at the grassroots level. It is intended for those who may be
program personnel or practitioners in education sector. It is designed to develop the basic
knowledge necessary to understand the ways education in general and school in particular is
financed. Students are encouraged throughout the course to consult libraries, relevant web-
sites, and participate in classroom discussions.

2. General Objectives
The general objectives of the course are as follows:
• To explore the conceptual premises of school financing.
• To study the linkage between educational providers and consumers
• To explore different forms and trends of financing of education.

3. Specific Objectives and Contents

Specific Objectives Contents
• Identify the basic principles of Unit: 1 Meaning and Scope of School
school finance. Financing (5)
• Explore the driving forces 1.1 Principles, scope and practices of school
behind the decision regarding finance
school finance. 1.2 Driving forces behind school finance

• Assess financing of education in Unit: II Demand and Trends of Education

general.
• Explore different competing
interests that influence education
finance.
• Explore the sources of finance.
• Identify the relationship between
national economy and education
expenditure.
• Explore the determinants of
education expenditure.
Financing (15)
2.1 Demographic pressure, social pressure,
political pressure, etc.
2.2 Individual and public demand
2.3 Education as economic good
2.4 Education: public or private good
2.5 Trends in sectoral education financing
2.6 Conditional cash transfer in education
2.7 Consumerism in education
Unit: III Expenditure on Education (10)
3.1 Sources of financing (internal and external
sources)
3.2 Gross domestic product (GDP), and gross
national product (GNP)
3.3 Equity and inclusion in expenditure
3.4 Quantity and quality aspects of educational
services
3.5 Social pay-off of education

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• Assess the approaches that are
adopted in financing education.
• Analyze the reasons behind
adopting one or the other approach.
• State different types of financing
modalities and reasons for applying
certain modality.
• Identify the implications of
different modalities for policy
decision.
• Explore and analyze the education
financing practices in Nepal.
• Identify the ways education
financing is controlled and
monitored at different levels of the
system
• Analyze the processes of managing
education financial resources
3.6 Minimizing educational wastage through
increased expenditure
Unit: IV Approaches to Education Financing
(5)
4.1 Human resource/capital approach
4.2 Social demand approach
4.3 Rate of return approach
4.4 Structural adjustment approach
4.5 Decentralization approach
Unit: V Conceptual Base and Practices of
Financial Modalities (10)
5.1 Block grants, Earmarked grants, Performance
based grants, Per-capita based grants and
voucher system.
5.2 Public-private partnership
5.3 Free, subsidy, cost sharing and cost recovery
5.4 Direct, indirect and opportunity cost
5.5 Salary and non- salary cost
5.6 Education policy implications of these
modalities
Unit: VI Past and Present Education
Financing Practices in Nepal (10)
6.1 Public-private partnership
6.2 Role of central and local bodies on school
finance (National Planning Commission,
Ministry of Finance, Financial Controller
General’s Office, Ministry of Education,
Department of Education, District Education
Office, School Management Committee,
Parent Teacher Association and Schools)
6.3 Sources of expenditure:-
Government(national, District Development
Committee/ Village Development
Committee), different forms of taxes and
revenue), non government (national and
foreign donors, schools’ own sources,
international non government organizations,
parents/community, religious institutions,
others)
6.4 Problems and issues of financing of
school education in Nepal
6.5 Audit: financial and social audit
Unit: VII Managing Educational Financial
Resource (10)
7.1 Planning of resources for the target
population
7.2 Fund flow mechanism: example from
Nepal
7.3 School-based allocation of resources
7.4 Demand side financing
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• Explore the philosophy and
rationale behind financing NFE
• Identify the financing
modalities of NFE.
• Explore the education financing
practices of some selected
countries.
• Assess the association between a
country’s political system and
education financing.
7.5 Supply side financing
Unit: VIII Financing of Non- Formal
Education (5)
8.1 Concept and practices of financing of
alternative schools (example from Nepal and
other countries)
8.2 Concept and practices of financing of adult
education/literacy programs (example from
Nepal, India and Bangladesh)
Unit: IX Education Financing Modalities in
Different Countries (5)
9.1 Education financing modalities in China,
France, India (Uttar Pradesh and Kerala),
Sri Lanka, USA.
9.2 Relation between political system and
education financing

4. Instructional Techniques
4.1 Common Instructional Techniques
Financing of education is influenced by many national and international factors and incidents.
Therefore changes can be seen in approaches. In this situation it is highly desirable for
teachers to be more proactive in updating oneself and collecting relevant materials in order to
deliver the course.
• Lecture, question answer and discussion
• Group work followed by presentation
4.2 Specific Instructional Techniques
• Study and critically analyze the documents published by the Ministry of Education, related
agencies with the government system and national and international organizations in relation
to financing of education.
5. Evaluation
Both formative evaluation and summative evaluation will be used to evaluate the learning of the
students. Formative evaluation includes written tests, class participation, preparation and presentation
of reports and practical exercises. The scores of the formative evaluation will be used for providing
feedback to improve their learning. Annual examination as a summative evaluation will be conducted
by the Office of the Controller of Examinations. The types and number of questions to be included in
the final examination are as follows:

Types of question Total questions to be Number of questions to be Weightage

included answered and marks to be
allocated
Group A: Multiple choice 8 8 x 1 mark 8 marks
items
Group B: Short answer 4 with three choice 4 x 6 marks 24 marks
questions questions
Group C: Long answer 2 with one choice 2 x 9 marks 18marks
questions question

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6. Recommended and References Books

Recommended Books
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Applying economic analysis to decision-making in developing nations - Internal efficiency of
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Ariel, F. & Norbert, S. (2009). Conditional cash transfers: Reducing present and future
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Boyle, S. Brock, A. Mace, J. & Sibbons, M. (2002) Reaching the poor. The ‘costs’ of sending
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Janssen, M.C.W., E. M, & Kamphorst, E. M. (2004). The Economics of demand-side
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