Quality Adjusting Education Sector Productivity

Abstract

This article examines how quality-adjusted productivity indices for the education sector may be constructed and proposes methods for making such adjustments to basic measures of labour and multifactor productivity growth. Results highlight the need for careful measurement, showing that measures unadjusted for quality are unlikely to provide sufficiently robust signals about changes in productivity performance in the education sector on which policy advice could be built. Our evidence suggests that quality adjustment to both inputs and outputs can make substantial differences to conclusions about productivity growth trends over 2000–15 compared with unadjusted indices.