Aid Volatility and the Pattern of Education Spending in Bangladesh

Bangladesh, with significant dependence on foreign aid after Independence especially for relief and reconstruction purposes, has diversified aid inflows over time to meet the country's increasing development needs. Foreign aid, particularly to the education sector, has,however, declined over the years. This paper examines the fluctuations in aid inflows to the education sector in Bangladesh vis-à-vis the country's domestic spending in education. Analysing aid volatility for the period 1980-2008, the paper reports that volatility in aid flows has not led to higher volatility in government's own spending on education. The results also validate that government's spending on education has led to improved performance in education indicators such as primary school enrolment.

Ishraq Ahmed
Bangladesh Institute of Development Studies, The Bangladesh Development Studies Vol. 34, No. 2 (June 2011), pp. 23-46 (24 pages)