Roads or Schools: A Critical Tradeoff
By Manoj Atolia, Bin Grace Li, Ricardo Marto, and Giovanni Melina
November 9, 2017
Versions in 中文(Chinese), Español (Spanish), Français (French), 日本語 (Japanese)
Low-income countries tend to spend less on schools than on roads as a share of GDP (photo: iStock by Getty Images).
Roads or schools? It’s a question akin to the “guns or butter” choice that governments around the world confronted in the 20th century: How to spend a nation’s finite resources to produce the maximum benefit for its people.
In our recent IMF Working Paper, we find that low-income countries tend to spend less on schools than on roads as a share of GDP—even though investment in education may be a more pressing need in their societies.