Knowl­edge for progress

Financial Mirror (Cyprus) - - FRONT PAGE -

Some 236 years ago, a young gover­nor from the Amer­i­can state of Vir­ginia broke the mold on ed­u­ca­tion re­form. In his Thomas Jef­fer­son called for “a sys­tem of gen­eral in­struc­tion” that would reach all cit­i­zens, “from the rich­est to poor­est.” It was the first step in the cre­ation of the Amer­i­can sys­tem of public ed­u­ca­tion – an in­sti­tu­tion that helped to pro­pel the coun­try’s rise to global promi­nence.

By the early 20th cen­tury, the United States was a global leader in public school­ing. In­vest­ments in ed­u­ca­tion pro­vided a cat­a­lyst for eco­nomic growth, job cre­ation, and in­creased so­cial mo­bil­ity. As Claudia Goldin and Lawrence Katz have shown, it was Amer­i­can “ex­cep­tion­al­ism” in ed­u­ca­tion that en­abled the coun­try to steal a march on Euro­pean coun­tries that were un­der-in­vest­ing in hu­man cap­i­tal.

As world lead­ers gath­ered for the Oslo Sum­mit on Ed­u­ca­tion for De­vel­op­ment, the lessons from this ex­pe­ri­ence could not be more rel­e­vant. In fact, with the global econ­omy be­com­ing in­creas­ingly knowl­edge­based, the ed­u­ca­tion and skills of a coun­try’s peo­ple are more im­por­tant than ever in se­cur­ing its fu­ture. Coun­tries that fail to build in­clu­sive ed­u­ca­tion sys­tems face the prospect of slug­gish growth, ris­ing in­equal­ity, and lost op­por­tu­ni­ties in world trade. In this con­text, some of to­day’s dis­cus­sions on ed­u­ca­tion sound cu­ri­ously anachro­nis­tic. Har­vard economist Ri­cardo Haus­mann re­cently be­rated what he de­scribes as the “ed­u­ca­tion, ed­u­ca­tion, ed­u­ca­tion crowd” for ad­vo­cat­ing an “ed­u­ca­tion-only” strat­egy for growth. It was an im­pres­sive at­tack on a view that, to the best of my knowl­edge, no­body holds.

Of course ed­u­ca­tion is not an au­to­matic route to growth. Ex­pand­ing ed­u­ca­tion in coun­tries where in­sti­tu­tional fail­ure, poor gov­er­nance, and macro-eco­nomic mis­man­age­ment stymie in­vest­ment is a pre­scrip­tion for low pro­duc­tiv­ity and high un­em­ploy­ment. In North Africa, the dishar­mony be­tween the ed­u­ca­tion sys­tem and the job mar­ket left young, ed­u­cated peo­ple with­out de­cent op­por­tu­ni­ties – a sit­u­a­tion that con­trib­uted to the rev­o­lu­tions of the Arab Spring.

None of this de­tracts from the vi­tal role of ed­u­ca­tion – not just years of school­ing, but gen­uine learn­ing – as an es­sen­tial com­po­nent of growth. Ex­ten­sive re­search – from the work of Adam Smith to Robert Solow and Gary Becker and, most re­cently, Eric Hanushek – con­firms the im­por­tance of learn­ing in build­ing pro­duc­tive hu­man cap­i­tal. One step up the stan­dard de­vi­a­tion score on the OECD’s Pro­gramme for In­ter­na­tional Stu­dent As­sess­ment is as­so­ci­ated with a 2% in­crease in a coun­try’s long-run growth rate.

Ed­u­ca­tion may not be a quick fix for slow growth. But try nam­ing a coun­try that has sus­tained an eco­nomic trans­for­ma­tion with­out ad­vances in ed­u­ca­tion.

Econ­o­mists at the World Bank have con­trib­uted a few straw men of their own to the ed­u­ca­tion de­bate. In one con­tri­bu­tion, Shanta De­vara­jan crit­i­cises the view that ed­u­ca­tion is an es­sen­tial public good that gov­ern­ments should fi­nance and de­liver, ar­gu­ing that it should in­stead be con­sid­ered a pri­vate good, de­liv­ered through mar­kets to cus­tomers – that is, par­ents and chil­dren – seek­ing pri­vate re­turns.

The prob­lem is that ed­u­ca­tion is self­evi­dently not a public good – in the real world, few things are. It is, how­ever, a “merit” good, some­thing that gov­ern­ments should of­fer for free, be­cause of the widerang­ing pri­vate and so­cial re­turns that might be lost if par­ents un­der­in­vest, or if the poor are ex­cluded. For ex­am­ple, progress in ed­u­ca­tion – es­pe­cially girls’ ed­u­ca­tion – is closely as­so­ci­ated with im­prove­ments in child sur­vival and nutri­tion, and ma­ter­nal health, as well as higher wages.

It is time to move be­yond fu­tile dis­cus­sions based on flawed logic to fo­cus on the real chal­lenges in ed­u­ca­tion – chal­lenges that must be ad­dressed, if we are to meet the Sus­tain­able De­vel­op­ment Goal of de­liv­er­ing high-qual­ity pri­mary and sec­ondary ed­u­ca­tion to all by 2030. The Oslo sum­mit presents an im­por­tant op­por­tu­nity to lay the ground­work for suc­cess. With 59 mil­lion pri­mary school-age chil­dren and 65 mil­lion ado­les­cents out of school, that op­por­tu­nity should be seized with both hands.

A suc­cess­ful sum­mit would ad­vance four key im­per­a­tives. First, gov­ern­ments must com­mit more do­mes­tic funds to ed­u­ca­tion. One back­ground pa­per for the sum­mit high­lights the fail­ure of suc­ces­sive gov­ern­ments in Pak­istan, which now has the world’s sec­ond-largest out-of-school pop­u­la­tion, to in­vest in ed­u­ca­tion. At the heart of the prob­lem are politi­cians who are more in­ter­ested in fa­cil­i­tat­ing tax eva­sion by the wealthy than im­prov­ing learn­ing op­por­tu­ni­ties for the poor.

Sec­ond, in­ter­na­tional donors must re­verse the down­ward trend in aid for ed­u­ca­tion. Even with an en­hanced re­source­mo­bil­i­sa­tion ef­fort, roughly $22 bln an­nu­ally in aid will be needed to achieve uni­ver­sal lower-sec­ondary ed­u­ca­tion. That is around five times cur­rent lev­els. Be­yond clos­ing the aid gap, United Na­tions Spe­cial En­voy on Ed­u­ca­tion Gor­don Brown has rightly called for fi­nanc­ing mech­a­nisms to de­liver ed­u­ca­tion to chil­dren af­fected by con­flict and hu­man­i­tar­ian emer­gen­cies.

Third, world lead­ers must get se­ri­ous about in­equal­ity. Ev­ery gov­ern­ment should be set­ting tar­gets aimed ex­plic­itly at nar­row­ing ed­u­ca­tion dis­par­i­ties – linked to gen­der, wealth, and the ru­ral-ur­ban di­vide – and align­ing their bud­gets with those tar­gets. As it stands, the dis­par­i­ties are huge. In Nige­ria, for ex­am­ple, ur­ban boys from the wealth­i­est 20% of house­holds av­er­age ten years of school­ing, while poor ru­ral girls in north­ern ar­eas can ex­pect less than two years. Yet, ed­u­ca­tion fi­nance is skewed to­ward the wealthy in most coun­tries.

Fi­nally, gov­ern­ments and aid agen­cies must aban­don mar­ket-based ex­per­i­ments, and com­mit to gen­uine sys­tem-wide re­form. One key pri­or­ity area is teach­ers, who need strong in­cen­tives, ef­fec­tive train­ing, and de­pend­able sup­port sys­tems to de­liver real learn­ing. Af­ter all, an ed­u­ca­tion sys­tem is only as good as its ed­u­ca­tors.

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