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Improving Investment in Efficiency of Public Spending on Jean-Jacques Hallaert SIP/2025/159 IMF Selected Issues Papers are prepared by IMF staff asbackground documentation for periodic consultations withmember countries.It is based on the information available at 2025December IMF Selected Issues Paper European Department Improving Investment in Human Capital in Croatia:Efficiency of Public Spending on Education and Healthcare Authorized for distribution by Yan Sun IMF Selected Issues Papersare prepared by IMF staff as background documentation for periodicconsultations with member countries.It is based on the information available at the time it was ABSTRACT:Croatia’s public spending efficiency in education and healthcare can be increased. Increasedefficiency would free fiscal resources that could be used for fiscal savings and/or improved outcomes. Thiswould require reforms such as consolidating schools, increasing instructional hours, revising curricula, shiftingemphasis from vocational education toward general education, and supporting tertiary enrollment. In RECOMMENDED CITATION:Hallaert, Jean-Jacques (2025), Improving Investment in Human Capital —Efficiency of Croatia’s Public Spending on Education and Healthcare,IMF Selected Issues Paper,SIP/2025/159, International Monetary Fund, Washington DC. SELECTED ISSUES PAPERS Improving Investment in Human Efficiency of Public Spending on Education and Prepared by Jean-Jacques Hallaert REPUBLIC OF CROATIA SELECTED ISSUES November20, 2025 Approved ByEuropean Department Prepared By Jean-Jacques Hallaert (EUR) CONTENTS IMPROVING INVESTMENT IN HUMAN CAPITAL IN CROATIA: EFFICIENCY OF A. Introduction _____________________________________________________________________4B. Education ________________________________________________________________________6C. Healthcare ______________________________________________________________________27 FIGURES1. Human Capital Index_____________________________________________________________5 2. Evolution of Public Expenditure on Education____________________________________63. Reading Achievement of Fourth Graders_________________________________________74. Achievement in Mathematics and Science of Fourth Graders ____________________85. Achievement of Fifteen-Year-Old Students ______________________________________96. Share of Low and High Performers Among the Fifteen-Year-Old Students _____107. Efficiency of Education Spending _______________________________________________118. Compulsory Instruction Time in Primary and Lower Secondary Education ______139. Enrollment Rate of 15–19-Year-Olds ____________________________________________1310. Enrolment Rates in Early Childhood Education and Care Services _____________1411. Government Employment in Selected Sectors _________________________________1712. Student-to-Teacher Ratio______________________________________________________1713. Teachers Working Part-Time___________________________________________________1814. Class-Size and Educational Outcome __________________________________________19 18. Employment Rate____________________________________________________________________________2319. Over-Qualification Rate______________________________________________________________________2320. Skills Mismatch ______________________________________________________________________________2421. Difference in Participation Rates in Early Childhood Education Between Highest and LowestIncome Tertiles ______________________________________________________________________________2522. Childcare Cost by Type of Household________________________________________________________2623. Evolution of Public Expenditure on Healthcare_______________________________________________2824. Source of Healthcare Expenditure ___________________________________________________________2825. Healthcare Coverage_________________________________________________________________________2926. Out-of-Pocket Healthcare Expenditure ______________________________________________________3027. Total Current Health Expenditure ____________________________________________________________3028. Health Outcomes ____________________________________________________________________________3129. Incidence of and Death from Cancer_________________________________________________________3230. Life Expectancy ______________________________________________________________________________3331. Healthspan __________________________________________________________________________________3432. Self-Reported Unmet Needs Due to Healthcare Organization _______________________________3533. Self-Perception of Health by Level of Income ________________________________________________3534. Efficiency of Healthcare Spending ___________________________________________________________3635. Hospital Spending ___________________________________________________________________________3936. Length of Hospital Stay _____________