Donor funding of multilateral aid agencies : determining factors and revealed burden sharing

This paper reports an empirical study of the factors affecting burden sharing among OECD's 22 DAC members in 'bankrolling' the multilateral aid agencies. Annual data over 1970–2000, pooled across the donor countries, form the basis for the empirical estimation of each donor's share in the ODA aid receipts for each multilateral agency. Our findings suggest the existence of reverse exploitation, i.e., the financial burden of the agencies is disproportionally carried by the smaller donors. The study also finds that factors such as inherent donor generosity, donor concern for domestic egalitarianism, and the extent to which donors are pro-poor in their bilateral aid policies have an impact on their readiness to support multilateral agencies financially. Size of the donor government and its budgetary balance positively influence burden sharing of contributions to other multilateral agencies. But neither the phase of economic cycle nor the rate of economic growth affects the burden-sharing responsibility of donors. It was also observed that contributions by EU members to the EC do not appear to crowd-out their contributions to other multilateral aid agencies and that right-wing donor governments are generally more parsimonious with regard to financial assistance to multilateral aid agencies. The preferred alternative, particularly among EU member countries, appears to be the EC.

Breaking up is hard to do : the economic impact of provisional funding contingent upon evidence development

Funding contingent upon evidence development (FED) has recently been the subject of some considerable debate in the literature but relatively little has been made of its economic impact. We argue that FED has the potential to shorten the lag between innovation and access but may also (i) crowd-out more valuable interventions in situations in which there is a fixed dedicated budget; or (ii) lead to a de facto increase in the funding threshold and increased expenditure growth in situations in which the programme budget is open-ended. Although FED would typically entail periodic review of provisional or interim listings, it may prove difficult to withdraw funding even at cost/QALY ratios well in excess of current listing thresholds. Further consideration of the design and implementation of FED processes is therefore required to ensure that its introduction yields net benefits over existing processes.

Funding special education provision by means of discriminant function analysis

This thesis is concerned with the development of a funding mechanism, the Student Resource Index, which has been designed to resolve a number of difficulties which emerged following the introduction of integration or inclusion as an alternative means of providing educational support to students with disabilities in the Australian State of Victoria. Prior to 1984, the year in which the major integration or inclusion initiatives were introduced, the great majority of students with disabilities were educated in segregated special schools, however, by 1992 the integration initiatives had been successful in including within regular classes approximately half of the students in receipt of additional educational assistance on the basis of disability. The success of the integration program brought with it a number of administrative and financial problems which were the subject of three government enquiries. Central to these difficulties was the development of a dual system of special education provision. On one hand, additional resources were provided for the students attending segregated special schools by means of weighted student ratios, with one teacher being provided for each six students attending a special school. On the other hand, the requirements of individual students integrated into regular schools were assessed by school-based committees on the basis of their perceived extra educational needs. The major criticism of this dual system of special education funding was that it created inequities in the distribution of resources both between the systems and also within the systems. For example, three students with equivalent needs, one of whom attended a special school and two of whom attended different regular schools could each be funded at substantially differing levels. The solution to these inequities of funding was seen to be in the development of a needs based funding device which encompassed all students in receipt of additional disability related educational support. The Student Resource Index developed in this thesis is a set of behavioural descriptors designed to assess degree of additional educational need across a number of disability domains. These domains include hearing, vision, communication, health, co-ordination (manual and mobility), intellectual capacity and behaviour. The completed Student Resource Index provides a profile of the students’ needs across all of these domains and as such addresses the multiple nature of many disabling conditions. The Student Resource Index was validated in terms of its capacity to predict the ‘known’ membership or the type of special school which some 1200 students in the sample currently attended. The decision to use the existing special school populations as the criterion against which the Student Resource Index was validated was based on the premise that the differing resource levels of these schools had been historically determined by expert opinion, industrial negotiation and reference to other special education systems as the most reliable estimate of the enrolled students’ needs. When discriminant function analysis was applied to some 178 students attending one school for students with mild intellectual disability and one facility for students with moderate to severe intellectual disability the Student Resource Index was successful in predicting the student's known school in 92 percent of cases. An analysis of those students (8 percent) which the Student Resource Index had failed to predict their known school enrolment revealed that 13 students had, for a variety of reasons, been inappropriately placed in these settings. When these students were removed from the sample the predictive accuracy of the Student Resource Index was raised to 96 percent of the sample. By comparison the domains of the Vineland Adaptive Behaviour Scale accurately predicted known enrolments of 76 percent of the sample. By way of replication discriminant function analysis was then applied to the Student Resource Index profiles of 518 students attending Day Special Schools (Mild Intellectual Disability) and 287 students attending Special Developmental Schools (Moderate to Severe Intellectual Disability). In this case, the Student Resource Index profiles were successful in predicting the known enrolments of 85 percent of students. When a third group was added, 147 students attending Day Special Schools for students with physical disabilities, the Student Resource Index predicted known enrolments in 80 percent of cases. The addition of a fourth group of 116 students attending Day Special Schools (Hearing Impaired) to the discriminant analysis led to a small reduction in predictive accuracy from 80 percent to 78 percent of the sample. A final analysis which included students attending a School for the Deaf-Blind, a Hospital School and a Social and Behavioural Unit was successful in predicting known enrolments in 71 percent of the 1114 students in the sample. For reasons which are expanded upon within the thesis it was concluded that the Student Resource Index when used in conjunction with discriminant function analysis was capable of isolating four distinct groups on the basis of their additional educational needs. If the historically determined and varied funding levels provided to these groups, inherent in the cash equivalent of the staffing ratios of Day Special Schools (Mild Intellectual Disability), Special Development Schools (Moderate to Severe Intellectual Disability), Day Special Schools (Physical Disability) and Day Special Schools (Hearing Impairment) are accepted as reasonable reflections of these students’ needs these funding levels can be translated into funding bands. These funding bands can then be applied to students in segregated or inclusive placements. The thesis demonstrates that a new applicant for funding can be introduced into the existing data base and by the use of discriminant function analysis be allocated to one of the four groups. The analysis is in effect saying that this new student’s profile of educational needs has more in common with Group A than with the members of Groups B, C, or D. The student would then be funded at Group A level. It is immaterial from a funding point of view whether the student decides to attend a segregated or inclusive setting. The thesis then examines the impact of the introduction of Student Resource Index based funding upon the current funding of the special schools in one of the major metropolitan regions. Overall, such an initiative would lead to a reduction of 1.54 percent of the total funding accruing to the region’s special schools.

Do public investments crowd out private investments? Fresh evidence from Fiji

In this paper, we investigate whether government investment crowds out or crowds in private investment for Fiji over the period 1950–2001. We begin by searching endogenously for break points in the data series using the Zivot and Andrews [J. Business Economic Stat. 10 (1992) 251–270] test. Upon finding that 1975 is the statistically significant break date, we divide the sample into two. Using the error correction mechanism test, we find that government and private investments are cointegrated over the period 1950–1975, but not for the period 1976–2001. We also find that in the former period government investment has crowded in private investment, while in the latter period the relationship between government and private investments has been statistically weak.