Effects of Government and Private Sector Financing on Higher Education Enrolment in Uganda (1970–2014)

Abstract

Background: The paper examines the effects of government and private sector financing on higher education enrolment in Uganda during the period 1970 to 2014. In the paper, data is analysed by use of the generalised least squares (GLS) method. Annual secondary data for the analyses was obtained from (a) the United Nations, consisting of household consumption, investment spending, government spending, and exports; and (b) UNESCO, consisting of observations on higher education enrolment. Government financing is estimated by annual levels of government spending and private sector financing is estimated by levels of household disposable income. Empirical results obtained reveal that:
(a) 1% increase in private financing (household disposable income spending) growth could have caused higher education enrolment growth to increase by 0.84% per annum on average Journal of the National Council for Higher Education Vol. 9, Issue 2, August 2021 107
UGANDA HIGHER EDUCATION REVIEW
during the 1970 to 2014 period, ceteris paribus; (b) 1% increase in government financing (i.e. government spending) growth could have led to 0.33% annual increase in higher education enrolment growth during the given period, ceteris paribus; and
(c) 1% increase in private consumption financing (household consumption) growth could have caused higher education
enrolment growth to increase by 0.68% per annum on average during the 1970 to 2014 period, ceteris paribus. More empirical results reveal that
(i) 1% increase in investment financing (investment spending) growth could have led to 0.17% annual increase in higher education enrolment growth during the given period; and
(ii) 1% increase in tax financing (household income tax spending) growth could have caused higher education enrolment growth to rise by 0.34% per annum during the 1970 to 2014 period, ceteris paribus. The paper recommends enhancement of higher education enrolment through increasing the financing of the private sector, government, household consumption, investment, and export sector, as well as broadening the tax base, aggregate output and higher education student loans at the level of household disposable income. Keywords: Government financing, private sector financing, higher education enrolment, attraction of students, retention of students.