Human Capital Development in Rwanda: Effects of Education, Social Protection and Rural Development Policies

Abstract

In 2000 the government of Rwanda launched Vision 2020, a framework for its long term development. In this document the low education level of the country’s main asset - its population - was identified as the major microeconomic structural problem that had to be addressed to facilitate the transition to a knowledge-based economy. The first education policy measures were implemented in 2003 and additional ones in the years after. This thesis investigated the impact of these education policy measures on household’s decisions about school attendance of children and their investments in education. It answered the questions “Which children profit from education policy, Which constraints remain and still hamper equity in access to primary and secondary education. Do poverty reduction or rural development programs foster education expenditures of household?” The abolishment of school fees in 2003 indeed improved school enrolment in general and the attendance of girls and deprived children in particular. The remedial and food-for-education programs contributed to keeping children longer at school or to return till completion. The education policies have been successful, but the objective has not been achieved fully. Substantial numbers of orphans/foster children still do not profit, and part of the children leave before completing school, in particular girls. Poverty leading to resource dilution when family size increases and sibling complementarity are probable causes for keeping children away from school and making them work. The hypothesis of resources dilution was confirmed by a decrease of household education expenditure per child for each addition of an under school age child in a household. Consequently primary completion rates reflect high levels of inequality, with lower rates for mono/double orphans, from rural areas, and from disadvantaged households. The ones that enter secondary education are therefore a selective group. Controlling for this selectivity, the analyses showed that after the introduction of a new type of secondary school (9YBE) in 2009, attached to existing primary schools, access to secondary education has become more equal over time, but that a new type of inequity emerged. Access to the most preferred type of secondary school (the more expensive traditional public boarding school that deliver a higher education quality) is restricted by school performance at primary school and level of socioeconomic disadvantage. The 9YBE schools serve the less performing students and the talented students from poor families. The impact of poverty on household education investments is illustrated by the large gap between the education expenditure of the poor and of the extreme poor compared to that of non-poor families. The research tested if poverty reduction or rural development programs contributed to higher education investments by households. In particular access to basic health services and access to waged work in employment schemes are related to a modest increase of household education expenditure. Apparently reducing risks of income shocks by a health insurance or access to regular paid work and credit make parents more confident to spend money on the education of their children. The availability of formal employment at district level had the same impact.