Public per capita spending and grade-age distortion in Upper Secondary Education in Minas Gerais (2013-2021)

Abstract

Grade distortion represents one of the main challenges in Brazilian basic education, as it reflects interrupted school trajectories, grade repetition, and the risk of dropout, undermining learning and educational equity. This study investigates the extent to which public per capita spending on education helps reduce this indicator in secondary education across the 853 municipalities of Minas Gerais between 2013 and 2021. The research employs a dynamic panel data model estimated using the System Generalized Method of Moments (SYS-GMM), which allows for controlling endogeneity and the temporal persistence of the phenomenon. The results indicate that higher per capita expenditures are associated with lower grade distortion rates, suggesting that public investment can promote the regularity of students’ educational progression. Furthermore, the lagged dependent variable confirms the inertia of school delay, and socioeconomic and health conditions are shown to influence students’ educational trajectories. The study advances the literature by estimating a dynamic model for a regional context that has been explored little, contributing to the design of more targeted educational policies.