Factors which Affect Productivity of Education Expenditure in Ethiopia: Evidence from Ethiopian Public Universities

This article measures the productivity of Ethiopian public universities and identifies the factors that influence it. Using a quantitative research approach and secondary data, the study targeted Ethiopian public universities to assess their total factor productivity (TFP). The researchers used a non-parametric approach, specifically the Malmquist productivity index, to measure TFP performance. They then used a parametric approach, or multiple regression analysis, to examine the factors affecting TFP change. In this study total factor productivity change was used as a proxy to measure productivity of universities and pure efficiency, technical efficiency and scale efficiency were considered as independent variable. The findings showed an overall decline in university productivity over the study period. However, the analysis also revealed a positive trend of yearly productivity improvement. The study found that all selected variables—technical change, pure efficiency change, and scale efficiency change has a positive and statistically significant effect on the productivity of education expenditure. The researcher would like to suggest the university community to focus work on the efficiency improvement to enhance the productivity of the university.