Costs in Context: Analysis of Cost Data in Eight USAID-funded Education Activities

• In Event: Comparing Costs: Methods for and Examples of Analyzing Activity Cost Data to Build Evidence

Proposal

In order to design, fund, and implement education activities that are responsive to unique contexts, sustainable beyond a donor’s involvement, and have the greatest possible impact, it is essential to understand the cost, cost-efficiency, and cost-effectiveness of activities across contexts.
This study uses cost data from 8 USAID-funded education activities to understand how the cost, cost structure, and cost drivers of teaching and learning materials, system strengthening efforts, community and parental engagement, and educator support and professional development vary across activities and contexts. Specific focus is placed on teacher training interventions, to determine cost-efficiency and cost-effectiveness estimates for these interventions and investigate regional differences in cost drivers for teacher training.
Data for this study were collected and analyzed using USAID Center for Education’s Cost Reporting Guidance and Cost Analysis Guidance. All of the implementing partners whose projects are included in this research documented their projects’ dosage, contribution, and output data in USAID’s cost reporting templates and submitted expenditure data from their accounting ledgers to USAID. The secondary data for this study includes book purchase orders (POs) and book shipping and distribution POs for the teaching and learning materials used in each activity. This framework for cost reporting and analysis ensures the comparability and transparency of results across activity analyses.
This study employs three cost analysis methods—cost-economy, cost-efficiency, and, when feasible, cost-effectiveness. Cost-economy assesses the cost of the activity’s components and the costs at which inputs were purchased. Cost-efficiency calculates the costs of producing outputs. The results are frequently expressed as unit costs for producing outputs. Cost-effectiveness analysis provides a financial estimate to generate a given outcome measured in the impact evaluation.
This is the first comparative analysis of education activities performed using these reporting and analysis processes. By analyzing eight individual activities, this analysis is a significant contribution to the evidence base on education activity costs. The research team hopes that this is only the beginning and that these findings inspire future studies using this analysis approach
The results from this study and further additions to the evidence base will provide education stakeholders with information to help inform future activity design. A greater understanding of what drives activity costs and which intervention components are the most cost-efficient or cost-effective in a given context will allow donors, implementing partners, and other stakeholders to identify activities that will provide the best value for money and the most lasting impact. It will also support realistic budget development and inform decision-making with activities that are to be scaled or transferred to local governments.

Author

• Emma Venetis, EnCompass LLC