Education in States and Nations: 1991

(ESN) Indicator 33: Current public expenditure per student as a percentage of GDP/GSP per capita

This indicator adjusts public per-student expenditure by the income of a country or state, as measured by gross domestic product (GDP) or gross state product (GSP), respectively. It allows for instructive comparisons among countries or states with wide differences in gross products by examining what each country or state spends on its students relative to its available resources. For example, a less wealthy country or state with a per-student expenditure equal to that of another may actually devote a larger share of its available resources to education. In such a case, the less wealthy country or state could be making a greater "fiscal effort" than the other.

• In 1991 at the primary - secondary level, per-student public spending in the United States was approximately 20 percent of GDP per capita. Among the G-7 countries, Canada, Italy, and France had larger proportions. Italy, which had the lowest GDP per capita, and thus the fewest resources from which to draw of the G-7 countries (see Indicator 4), had the second highest percentage (22.0).

• The U.S. states displayed a fairly wide range of per-student expenditure at the primary through secondary level as a percentage of their per-capita gross products, from close to 15 percent in Louisiana and Delaware to 28 percent or more in Vermont and West Virginia. However, the range across the countries represented here extended even wider. Australia and Japan spent less per student for primary through secondary education as a percentage of their per-capita gross products than did Louisiana. Conversely, Sweden spent more per student as a percentage of its per capita gross product than did Vermont.

• In the United States in 1991, current public expenditure per student at the higher education level as a percentage of per capita GDP was about 30 percent. Percentages in the states ranged from 16.8 in New Hampshire to 56.7 in New Mexico. The U.S. percentage was lower than those for Canada and the United Kingdom, but higher than those for the other G-7 countries - West Germany, France, Italy, and Japan.

Notes on interpretation:

Both Indicators 30 and 33 are measures of "fiscal effort" because they relate public expenditure to country or state wealth. Indicator 33 attempts to control for the proportion of the population that is of school age and enrolled in school. It is, thus, somewhat less volatile, and more consistent, than Indicator 30 in the face of varying proportions of school-aged populations to the general population. Countries or states with relatively high birth rates, for example, would likely rank relatively higher on Indicator 30 than on this indicator, other factors held equal.

This indicator does not, however, control for access to school. Some countries or states may have relatively high dropout rates due to an insufficient supply of school places given the demand, cultural norms that keep would-be students (especially females) at home, or the demands of poverty that force young people to begin work at an early age. Considering just this aspect of access to education, Indicator 30, which does not control for the number of enrolled students (and, thus, does not exclude dropouts from its calculation), is the less volatile, and more consistent, measure of fiscal effort.

In some countries, particularly the United States and Japan, a large portion of expenditure on higher education comes from private sources, which are not included in this indicator. See the supplemental note to Indicator 33 for data on private higher education expenditure in certain countries.

Table 32b

Figure 33a