Browsing by Author "RICHARD MUKIRI NDIBARU"

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    MACROECONOMIC IMPLICATIONS ON EDUCATION FUNDING IN KENYA BETWEEN 2013-2023
    (THE CATHOLIC UNIVERSITY OF EASTERN AFRICA, 2025-10) RICHARD MUKIRI NDIBARU
    Education funding in Kenya continues to face persistent challenges, primarily due to inconsistencies in budget allocation amid escalating educational demands and economic volatility. Guided by Quantity, Loanable and Debt Overhang theories, this study investigated the macroeconomic factors influencing education funding in Kenya. The focus was on the impact of inflation, interest rates and public debt on government Education Funding between 2013 and 2023. A quantitative research design was employed, utilizing a panel data econometric framework that combined both cross-sectional and time-series data across primary, secondary, TVET and university levels. Secondary data were sourced from reputable institutions such as the Kenya National Bureau of Statistics (KNBS), the Central Bank of Kenya (CBK), the National Treasury and the Ministry of Education. Analysis was conducted using STATA Version 15.0, applying both Fixed Effects and Random Effects regression models. The results indicated significant negative relationships between the three macroeconomic variables and public education funding. Specifically, a one-percentage-point rise in inflation corresponded with an approximate reduction of KES 1.754 billion in education expenditure. Likewise, a one-percentage-point increase in interest rates was linked to a decline of KES 2.143 billion, while a one-percentage-point rise in the public debt-to-GDP ratio was associated with an estimated reduction of KES 953 million in education funding. From these findings, the study concluded that macroeconomic instability considerably constrained the government’s capacity to sustain education investment. It recommended that policymakers adopt prudent debt management practices, establish effective inflation-targeting mechanisms and maintain interest rates at manageable levels to protect education fundings. In addition, the study suggested that both the government and development partners enhance fiscal resilience by diversifying funding sources to ensure steady and equitable financing of education despite prevailing economic pressures.