Smart Spending in Education in Latin America and the Caribbean

Group Submission Type: Book Launch

Description of Session

Latin America and the Caribbean (LAC) face a critical education financing crisis that threatens the region’s capacity to sustain development and global competitiveness. Between 1995 and 2010, public investment in education rose from 2.99% to over 5% of GDP, signaling strong progress toward expanding educational opportunities. Yet this momentum was not sustained. By 2022, public education investment had fallen to just 3.89% of GDP—below UNESCO’s recommended 4–6%.

The challenges of education financing in the region go far beyond limited investment levels. Although some countries have tried to increase resources through GDP-based spending targets or earmarked taxes, few have complemented these efforts with comprehensive reforms to ensure efficiency. Ministries of Education often lack robust management and data systems to plan budgets effectively, and they typically enter negotiations with weak bargaining power while competing with priorities such as health and security. Resource allocations are frequently determined by historical and discretionary practices, and in some cases are shaped by pressure from interest groups, particularly unions. As a result, resources are often distributed in ways that are both inadequate and inequitable.

In response to these challenges, the book “Smart Spending in Education in Latin America and the Caribbean” presents a comprehensive school finance model to guide policymakers in LAC and beyond on how education resources are mobilized, distributed, executed, and monitored. Each of these four operational dimensions is anchored in a fundamental principle of effective financing: adequacy (mobilization), equity (distribution), efficiency (execution), and transparency (monitoring). The model highlights a key insight: while increasing the volume of resources is essential, the way those resources are managed and aligned with policy priorities is equally critical to improving learning outcomes.

The framework was developed through a two-phase research process. The first phase consisted of an exhaustive review of academic literature, regulatory frameworks, and OECD best practices—covering resource allocation formulas, budget execution mechanisms at both national and local levels, and monitoring and evaluation systems. The second phase brought the analysis into the field, with more than 50 in-depth interviews conducted across 22 LAC countries. Interviewees included former ministers and vice-ministers of education, technical teams from ministries of finance and education, school principals, parents, researchers, and representatives of civil society. By combining rigorous international analysis with grounded local perspectives, the study generated a nuanced understanding of both the structural challenges and the opportunities for reform.

In this panel, we will synthesize the book’s key findings and present actionable strategies for building education financing systems that are more adequate, equitable, efficient, and transparent. From among the authors, Gregory Elacqua and Luana Marotta would serve as presenters, highlighting the central messages of the work. The book launch would also feature a discussion led by professors Martin Carnoy and Tassia Cruz, who would offer critical reflections and situate the findings within broader debates on education policy, financing, and equity in the region.

Sub Unit

• Book Launches and Workshops / Book Launch

Chair

• Luana Marotta, Inter American Development Bank

Book Launch Presenters

• Gregory Elacqua, Inter-American Development Bank

• Luana Marotta, Inter American Development Bank

Discussants

• Martin Carnoy, Stanford University

• Tassia de Souza Cruz, FGV EBAPE - Fundação Getulio Vargas