PEOPLE in rich countries often have little sense of how poor the quality of education is in many developing countries. Where schools exist, there may be no teachers; and where teachers are employed, often they might as well not be, either because they fail to turn up or because, even if they do appear, they do not know how to teach. Schools may be shacks, lacking basic equipment such as desks or chairs, with few if any teaching materials such as books, paper and pencils. Up to now, much stress has been laid on raising the proportion of children who enrol in schools (and, to a lesser extent, on ensuring that they keep going once they have enrolled). But what is the point of “universal enrolment” if schools and teachers are unable to provide a decent education?

This is one of the points emphasised by Lant Pritchett of Harvard University, in a new paper for the Copenhagen Consensus project*. It is important, he argues, to concentrate on educational achievement, rather than on simpler but potentially misleading measures of success. Only in that way will it be possible to know in what way extra resources can best be deployed in improving education in poor countries, and what sort of value for money might then be expected.

There is no question that education in many third-world countries is failing. Some of the findings reviewed by Mr Pritchett are positively startling. With the exception of eastern Europe, the former Soviet Union and the East Asian tigers, the developing countries lag far behind the rich OECD countries on measures of learning achievement—and most such comparisons, remember, underestimate the gap because test results are available only for children who actually attend school, which many children in poor countries do not. Even on this basis, results show that most developing countries have levels of educational attainment that are not merely at the lower end of the range for OECD countries, but far worse than even the worst-performing rich country (which is Greece, by the way).

In the most recent assessment, only 3% of students in Indonesia had a reading competence better than the average of French students; the average Brazilian student had maths skills at the level of the lowest 2% of Danish students. Americans worry from time to time about the undeniably impressive lead that Japanese students have over students in the United States—but the gap between American students and students in Peru is fully three times bigger.

There can be no doubt that an educational deficit as wide as this is holding poor countries back, thwarting the opportunities that they might otherwise be able to exploit in a rapidly globalising world economy. What, then, can be done?

Money changes everything?

Supposing that more resources were made available—the premise of the Copenhagen Consensus project—Mr Pritchett considers four broad ways of using them. First, build more schools. Second, improve the quality of existing school systems, either by expanding budgets across the board or by increasing spending in specific target areas. These first two ideas aim to increase the supply of education. Third, raise the demand for education, either through interventions that raise living standards generally, or by fostering new opportunities for the better educated. Fourth, raise the demand for education by reducing its cost to consumers.

Mr Pritchett weighs the pros and cons of each approach. He sees some scope for making progress by targeting additional resources to particular supply-side bottlenecks. These may be important in some countries. Raising the demand for education would help even more. Economic growth is pro-education, because higher living standards do raise the demand for schooling—but, obviously, policies to raise the growth rate need not be educational policies at all in the usual sense.

In any event, all four of the “policy-action opportunities” take the overall structure of existing education systems and methods for granted. And for that reason, Mr Pritchett argues, all four are neglecting the main issue: “the problem in many countries is the way in which the production of schooling is organised.” Systemic reform—involving clear objectives for the school system, adequate financing, autonomy for schools in “managing for results”, and proper accountability of schools to their users—may be necessary before higher spending on any of the four policy-action opportunities can be expected to succeed.

There are many ways to press forward this kind of systemic reform, Mr Pritchett argues. Vouchers and a “market” for education might work well in some circumstances, but other approaches could achieve good results too in some cases: school autonomy (as granted to “charter schools” in the United States, for instance), decentralisation of control, community management, and the use of non-government providers, could all, Mr Pritchett argues, serve the goal of structural reform that he regards as necessary if the application of extra resources is to succeed.

One striking indication of how easy it is to spend money fruitlessly in education comes from the rich countries. According to one study cited by Mr Pritchett, Britain increased its real spending per pupil by 77% between 1970 and 1994; over the same period, the assessment score for learning in maths and science fell by 8%. Australia increased its real spending per pupil by 270%; its pupils’ scores fell by 2%. Extra spending by itself is likely to be no more successful in the poor countries than it has been in the rich.

Overall expansion of education systems—the first policy-action opportunity—is likely to work well only in countries where demand exceeds supply (which would be indicated by large class sizes and children travelling great distances to school) and where new schools of good quality can be readily provided. These conditions are rarely satisfied, Mr Pritchett finds. In practice, lack of appropriate incentives for the efficient supply of education frustrates most spending initiatives, even those that try hard to spend money only where it is most needed. The most promising way forward is to embark on reforms that provide for greater autonomy and local accountability for schools. In many cases, Mr Pritchett notes, some extra financing may indeed help to facilitate those changes. But in improving education in the developing countries, additional resources are not usually the crux of the matter.

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