Education Financing Models in Developed and Developing Countries: Lessons and Policy Implications for Tanzania

Abstract

Education financing is a critical determinant of educational access, quality, equity, and sustainability, yet significant disparities exist between developed and developing countries in terms of their ability to finance education effectively. This study examined education financing models in developed and developing countries and identified lessons applicable to Tanzania. A systematic literature review (SLR) approach was employed to identify, evaluate, and synthesize relevant evidence from peer-reviewed journal articles, policy documents, and reports obtained from Google Scholar, Scopus, ERIC, Web of Science, UNESCO, UNICEF, the World Bank, OECD, and the European Commission. The review followed a systematic process of identification, screening, eligibility assessment, and thematic synthesis. The included studies were published in English between 2020 and 2024 and focused on education financing mechanisms, funding sources, financing challenges, and policy interventions, while duplicate records, non-English publications, editorials, conference abstracts, and studies unrelated to education financing were excluded. The findings reveal that developed countries predominantly rely on tax-based public financing systems supported by strong institutional frameworks and equitable resource allocation mechanisms, whereas developing countries depend on a combination of public funding, household contributions, private-sector participation, and external donor support. Although donor assistance has expanded educational access in many developing countries, excessive dependence on external funding raises concerns regarding sustainability and policy autonomy. The study concludes that Tanzania can strengthen its education financing system by increasing domestic resource mobilization, promoting public‒private partnerships, enhancing equitable resource distribution, and reducing its reliance on donor funding to achieve sustainable educational development.