UNDERSTANDING THE ROLE OF RELEVANT INCOME-GENERATION PROJECTS IN BUDGET DEFICIT FINANCING: INSIGHTS FROM A MIXED-METHODS STUDY IN TANZANIA’S PUBLIC UNIVERSITIES

Abstract

Revenue-generating initiatives have become essential mechanisms for strengthening the financial sustainability of public universities and reducing dependence on government and donor funding. This study examined the effect of relevant Income Generation Projects (IGPs) on budget deficit financing in Tanzanian public universities using an explanatory sequential mixed-methods design underpinned by pragmatic philosophy. The target population comprised 4,523 individuals, from which 303 respondents were selected through simple random and purposive sampling. Quantitative data were collected through structured questionnaires and analyzed using hierarchical multiple linear regression, while qualitative data from interviews were thematically analyzed to expand and validate the quantitative findings. In Step 1, institutional characteristics (university age and size) were entered and produced a statistically significant baseline model (R² = 0.104). In Step 2, the main predictor; relevance of IGPs was introduced, resulting in a substantial increase in explanatory power, with the full model accounting for 63.4% of the variance in budget deficit financing (R² = 0.634). The R² change of 0.530 indicated that the relevance of IGPs contributed significantly to explaining additional variance beyond the control variables. Regression results confirmed a significant positive effect between relevance of IGPs and budget deficit financing (B = 0.108, β = 0.123, t = 3.022, p < .05). Qualitative findings supported these results, showing that IGPs aligned with institutional missions and community needs yield stronger financial returns. However, respondents also highlighted that the positive impact of relevant IGPs is often undermined by ineffective management, unmet operational benchmarks, and inconsistent project performance. The study concludes that relevance of IGPs is a significant predictor of budget deficit financing, but its effectiveness is constrained by managerial weaknesses. It recommends introducing leadership and financial management training for individuals overseeing IGPs to maximize their contribution to budget deficit financing and enhance long-term financial sustainability within public universities.

JEL: I22 – Educational Finance, Financial Aid; H52 – Government Expenditures and Education; H61 – Budget, Budget Systems; L31 – Nonprofit Institutions, NGOs; Social Enterprises; M21 – Business Economics, Management

Article visualizations: