Using state- and municipality-level data during 1991-2002, this paper shows that FUNDEF played a key role in the increase in enrolment rates over the period, particularly in small municipalities, which rely more heavily on transfers from higher levels of government as a source of revenue. These findings underscore the importance of FUNDEF in eliminating supply constraints to the improvement of education attainment.
Link
http://hermia.sourceoecd.org/vl=1789003/cl=14/nw=1/rpsv/cgi-bin/wppdf?file=5lgp4z9rrqvj.pdf