1. Education & Inequality
Economics of Education (Hons)
8 May 2012
Nicholas Spaull
nicspaull.com/research

2. Education & Inequality
Income inequality?
Earnings
Inequality of opportunity?
Access / life chances
Political inequality?
Power relationships
Social inequality?
Class
Race
Gender
Language
How do we define inequality? How does education influence these inequalities?
EDUCATION

3. $ Benefits of education Economy Health Society Ed H S Ec
Improved human rights
Empowerment of women
Reduced societal violence
Promotion of a national (as opposed to regional or ethnic) identity
Increased social cohesion
Lower fertility
Improved child health
Preventative health care
Demographic transition
Improvements in productivity
Economic growth
Reduction of inter-generational cycles of poverty
Reductions in inequality $
Economy
Health
Society
Specific references: lower fertility (Glewwe, 2002), improved child health (Currie, 2009), reduced societal violence (Salmi, 2006), promotion of a national - as opposed to a regional or ethnic - identity (Glewwe, 2002), improved human rights (Salmi, 2006), increased social cohesion (Heyneman, 2003), Economic growth – see any decent Macro textbook, specifically for cognitive skills see (Hanushek & Woessman 2008)

4. Theory: Human Capital Incr MP of L Incr wage Man Skills & health
Education increases peoples ability to add value (productivity)  HCM + =   “The failure to treat human resources explicitly as a form of capital, as a produced means of production, as the product of investment, has fostered the retention of the classical notion of labour as a capacity to do manual work requiring little knowledge and skill, a capacity with which, according to this notion, labourers are endowed about equally. This notion of labour was wrong in the classical period and it is patently wrong now. Counting individuals who can and want to work and treating such a count as a measure of the quantity of an economic factor is no more meaningful than it would be to count the number of all manner of machines to determine their economic importance” (Schultz, 1961, p. 3).
Incr MP of L
Incr wage
Man
Skills & health
Incr profits

5. Elusive equity
Given the strong links between education and income, educational inequality is a fundamental determinant of income inequality.
Clear need to understand SA educational inequality if we are to understand SA income inequality.
High inequality + unemployment 2 of the most severe problems facing SA
Educational quality is intimately intertwined with both of these.
“Education shall be free, compulsory, universal and equal for all children” (Freedom Charter)

6. SA is one of the top 3 most unequal countries in the world
Elusive equity
Type of education
Quality of education
Duration of education IQ
Motivation
Social networks
Discrimination
SA is one of the top 3 most unequal countries in the world
Between 78% and 85% of total inequality is explained by wage inequality
Wages

7. Theory – education in SA
SES at birth
Cognitive ability in early childhood
Educational performance in early school years
Educational achievement in matric
Ultimate educational attainment and quality
Labour market performance
Type of tertiary education (quality) - institution and field of study
Demand and supply
Individual motivation
Parental IQ (assortative mating)
Maternal health
Nutrition
Early cognitive stimulation: preschool (quantity & quality), home environment
South Africa
Cost of tertiary education (explicit & implicit costs)
Parental & personal aspirations and perceptions
Society/culture
Average school SES
Language of learning & teaching (LOLT)
Teacher quality
Peer effects
Subject choice
(See Taylor, 2010)

8. For UK
SES at birth
Cognitive ability in early childhood
Educational performance in early school years
Educational achievement in matric
Ultimate educational attainment and quality
Labour market performance
South Africa
These graphs are from Spaull (2011), Taylor (2011), Moses (2011) and Van Broekhuizen (2012 – tut slides)

9. Righting the wrongs...
Is spending a good proxy for true inequalities in education?
What are other possible measures of progress or improvement?
Which are most valuable? Why?

10. Intergenerational inequality
Ideal world (AKA Finland  )
Means blind
Ideally, an education system should be ‘means blind’ in that it offers equal educational opportunities to all students.
Meritocratic
Ideally, an individuals success at school (and later in the labour-market) should depend on ability and effort not class or wealth.
In SA, neither of these criteria are met. Low quality education is a poverty trap.
Hereditary poverty
Low social mobility
Low quality education

11. SA educational inequality

12. Two education systems not one
Ex-Department
NSES Gr 4 (Taylor, 2011)
Mean >> median
Average SA student does not exist in any meaningful sense. Most average figures overestimate what the majority of SA students can do
Language PIRLS Gr 5 (Shepherd, 2011)
Socioeconomic status
SACMEQ Gr 6 (Spaull, 2011)

13. Educational inequality
Spatial inequalities
“Geography becomes critical when access to opportunities is distributed unevenly over space” (Yamauchi, 2011)
Under apartheid limited movement for non-whites
Positive correlation between school quality and school fees, quality education remains concentrated in formerly white, coloured and indian schools where the majority is non-African.
Think of Stellenbosch, Khayamandi and Cloetesville – apartheid distinctions. Coloured children go to Rhytenbos, Black children go to Khayamandi high, White children go to Rhenish (generalization).
Yamauchi, 2011
Taylor, 2011
Average White Gr3 student knows more than the average Black Gr5 student (wrote same test).
Does this mean more resources is the answer?

14. More reading textbooks
Resources the issue?
More reading textbooks  
More maths textbooks
 $79/pupil
 $1225/pupil

16. School Wealth Quartiles
Table 1: Distribution of Various Schooling Statistics across School Wealth Quartiles (Grade 6 - SACMEQ III)
Category
Variable
School Wealth Quartiles 1 2 3 4
Total
Performance
Reading score
430.5
457.8
474.0
623.7
494.9
Mathematics score
450.9
467.1
470.7
593.8
494.8
Proportion functionally illiterate
43.3%
33.3%
25.6%
4.1%
27.3%
Proportion functionally innumerate
56.9%
48.6%
44.8%
8.4%
40.2%
Reading teacher reading score
731.8
738.9
732.9
827.0
757.7
Maths teacher mathematics score
719.6
729.1
751.7
863.5
763.6
Textbooks
Has own reading textbook
34.4%
42.3%
38.2%
66.1%
45.0%
Has own mathematics textbook
27.6%
35.8%
32.3%
50.9%
36.4%
School factors
Gets homework "Most days of the week"
49.9%
52.1%
46.1%
75.8%
56.1%
Self-reported teacher absenteeism (days)
24.2
22.7
20.1
11.6
19.7
Repeated at least 2 grades
10.9%
9.3%
10.3%
1.8%
8.1%
Pupil-Teacher-Ratio
36.3
34.8
35.5
30.5
34.3
School in urban area
5.5%
21.4%
31.2%
73.3%
31.9%
Student very old (14y+)
23.7%
20.1%
14.0%
2.0%
15.3%
Home background
Speaks English at home 'Always'
5.6%
7.4%
9.2%
39.5%
Student has used a PC before
11.8%
39.9%
51.4%
94.9%
47.8%
More than 10 books at home
17.3%
23.0%
30.8%
67.2%
34.1%
At least one parent has matric
29.9%
40.6%
49.3%
77.2%
48.5%
At least one parent has a degree
4.7%
7.8%
10.7%
28.7%
12.8%
[1] By this definition, a functionally illiterate learner cannot read a short and simple text and extract meaning, while a functionally innumerate learner cannot translate graphical information into fractions or interpret everyday units of measurement. See Shabalala (2005, p. 222) and Spaull (2011, p. 33) for further information.

18. conclusions & recommendations
Questions,
conclusions & recommendations

19. Conclusions
Hereditary poverty
Low social mobility
Low quality education
Speaking of a single education system in SA is a misnomer – the average South African student does not exist in any meaningful sense.
 Bimodality is a fact.
Types of inequalities?
Income, language, geography, class,
Serious blight on the national conscience
Persistent patterns of poverty and privilege

20. Questions
If not the quality of education, what is the driving force behind income inequality?
Why is it so difficult to change educational outcomes? (18 years since 1994!)
How important are spatial inequalities in explaining the differences? Solution?

21. Conclusion?
What do you think are the most important points you’ve heard today?

22. Persistent patterns of poverty and privilege
Hereditary poverty
Low social mobility
Low quality education
Conclusion
Persistent patterns of poverty and privilege
Educational inequality is at the heart of income inequality and poverty
Increasing wages for the majority of Black labour market entrants is necessary to lower income inequality
This is not possible without improving the quality of education they receive
SA has 2 education systems not one
Implications for reporting (means are misleading)
Implications for policy
SA cannot convert material advantage into cognitive skills
Inefficient use of resources

23. Research
Do you have any interesting hypotheses you would like to test for your theses?
Interesting research questions to ask?

24. Suggestions Get the basics right
Teachers need to be in school teaching
Every child (teacher) needs access to adequate learning (teaching) materials
Every school should meet basic sanitation and health requirements
Every child should receive one year of adequate quality preschool education
No child should be hungry at school (for social & cognitive reasons)
Continuous diagnostic testing to figure out what children actually know
Make sure that the curriculum is tailored to the educational needs of the majority of students, not the top 15%
Every student MUST master the basics of foundational numeracy and literacy – these are the building blocks of further education – weak foundations = recipe for disaster
SA is a middle income country which spends 20% (!) of all government expenditure on education – this is not rocket science.
[ANA’s and workbooks are a very good sign – (but) need consistency and time]

25. Suggestions Acknowledge the extent of the problem
Low quality education is one of the three largest crises facing our country (along with HIV/AIDS and unemployment). Need the political will and public support for widespread reform.
Experiment to figure out what works
More of the same hasn’t worked  Need to try new things and rigorously evaluate them to see what works.
Workbooks & ANA’s are a positive sign (Workbook delivery?)
Failed programmes provide useful information when acknowledged & disseminated.
Leave existing salaries the same but pay good teachers more – why not?
Increase accountability, information & transparency
Where is the money going?
Deal ruthlessly with corruption – this is a social crime.
For at least one grade (Gr6?) get ANA externally validated by an independent body like Umalusi and get this information to parents  need to empower parents with information in an accessible format

26. References
Becker, G. (1962). Investment in Human Capital: A Theoretical Analysis. The Journal of Political Economy, 70(5), 9-49.
Currie, J. (2009). Healthy, Wealthy, and Wise: Socioeconomic Status, Poor Health in Childhood, and Human Capital Development. Journal of Economic Literature, 47(1),
Donalson, A. (1992). Content, Quality and Flexibility: The Economics of Education System Change. Spotlight 5/92. Johannesburg: South African Institute of Race Relations.
Fleisch, B. (2008). Primary Education in Crisis: Why South African schoolchildren underachieve in reading and mathematics. Cape Town. : Juta & Co.
Hanushek, E. & Woessmann, L. (2008). The Role of Cognitive Skills in Economic Development. Stanford Institute for Economic Policy Research Working Paper No
Hoadley, U. (2010). What do we know about teaching and learning in primary schools in South Africa? Stellenbosch: Appendix B to Van der Berg, S; Meyer, H; Reeves, C; van Wyk, C; Hoadley, U; Bot, M; & Armstrong, P 'Grade 3 Improvement Project: Main report and Recommendations" for Western Cape Education Department.
Schultz, T. (1961). Investment in Human Capital. The American Economic Review , 51 (1), 1-17.
Shepherd, D. (2011). Constraints to School Effectiveness: What prevents poor schools from delivering results? Stellenbosch Economic Working Papers 05/11.
Spaull, N. (2011). Primary School Performance in Botswana, Mozambique, Namibia and South Africa: A Comparative Analysis of SACMEQ III. SACMEQ Working Papers , 1-74.
Taylor, S. (2011). Uncovering Indicators of Effective School Management in South Africa using the National School Effectiveness Study. Stellenbosch Economic Working Papers .
Van der Berg, S. (2007). Apartheid's Enduring Legacy: Inequalities in Education. Journal of African Economies, 16(5),

27. Thank you www.nicspaull.com/research nicholasspaull@gmail.com

28. SACMEQ III (2007) Botswana 10.6 days 10.62% 22.48% 63% 62% Mozambique
Country
Total population (mil)
Adult literacy rate
Net Enrolment Rate (2008)
GNP/cap PPP US$ (2008)
Public Current expenditure on primary education per pupil (unit cost) 2007 – [PPP constant 2006 US$]
Survival rate to Grade 5: school year ending 2007
Botswana
1.92
83%
87%
13100
1228
89%3
Mozambique
22.38
54%
80%
770
792
60%
Namibia
2.13
88%
89%
6270
668
87%3
South Africa
49.67
9780
1225
98%
Source
(UNESCO, 2011)
(UIS, 2009)
SACMEQ III (2007)
Self-reported teacher absenteeism
Proportion of Grade 6 students functionally illiterate
Proportion of Grade 6 students functionally innumerate
Proportion of students with own reading textbook
Proportion of students with own mathematics textbook
Botswana
10.6 days
10.62%
22.48%
63%
62%
Mozambique
6.4 days
21.51%
32.73%
53%
52%
Namibia
9.4 days
13.63%
47.69%
32%
South Africa
19.4 days
27.26%
40.17%
45%
36%