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IV.B Education and Development Carleton University ECON 3508 (Text, Chapter 8, pp. 359- 386] February 14, 2013 Arch Ritter.

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Presentation on theme: "IV.B Education and Development Carleton University ECON 3508 (Text, Chapter 8, pp. 359- 386] February 14, 2013 Arch Ritter."— Presentation transcript:

1 IV.B Education and Development Carleton University ECON 3508 (Text, Chapter 8, pp ] February 14, 2013 Arch Ritter

2 The Central Roles of Education and Health Health and education are important objectives of development, as reflected in Amartya Sens capability approach, and in the core values of economic development Health and education are also important components of growth and development

3 Education and Health as Joint Investments for Development These are investments in the same individual; Mutually supportive Greater health capital may improve the returns to investments in education Health is a factor in school attendance Healthier students learn more effectively A longer life raises the rate of return to education Healthier people have lower depreciation of education capital Greater education capital may improve the returns to investments in health Public health programs need knowledge learned in school Basic hygiene and sanitation may be taught in school Education is needed in training of health personnel

4 Improving Health and Education: Why Increasing Incomes Is Not Sufficient Increases in income often do not lead to substantial increases in investment in childrens education and health But better educated mothers tend to have healthier children at any income level Significant market failures in education and health require policy action Signifying major Government roles everywhere

5 What is Education? Where does one get it?

6 What is Education? All forms of learning and improving human knowledge and capabilities All forms of learning and improving human knowledge and capabilities Education =/= Schooling Education =/= Schooling Types of education: Types of education: Informal: Informal: At home, from our parents and family, friends……. At home, from our parents and family, friends……. On our own, learning by doing On our own, learning by doing At play On the job; at work At play On the job; at work In conversation In our communities In conversation In our communities Formal Formal At day-care, school, college, university, classes… At day-care, school, college, university, classes… Employee training Employee training Formal apprenticeships Formal apprenticeships

7 The Functions of Education

8 General socialization; Ethical Community & citizenship responsibility Fundamental personal empowerment Improvement in personal and family quality of life Joy of learning…an end in itself Understanding the world and ourselves Human capital: of particular relevance here

9 Human Capital The economists term for the knowledge and skills that workers acquire through education, training, and experience. Produced through investment in people E xamples: formal education, health, informal education,sanitation, family environmentwater availability, nutrition,

10 Education and Development In general: Education promotes development and Development promotes education ? How does education promote development ?

11 Education and Development How does education promote development? Basic literacy and numeracy are indispensible for coping and survival in the modern world Generates skills of all sorts needed in the economy via nutrition, health, child-care spill-overs or externalities Improved parental, esp. mothers education builds human capital of children; e.g. via nutrition, health, child-care spill-overs or externalities May improves quality and scope of entrepreneurship on farms and in other economic activities

12 But education on its own will not produce development; Public policy mess-ups, institutional stupidities and political dysfunction all can overwhelm good education and produce stagnation and contraction

13 Development and Education Does development promote education? How?

14 Education and Development How does development promote education? Development (sustainable growth plus equity) generates the resources that can improve and support education Growth leads to increased tax revenues for public education expenditures; Higher family incomes permit increased family financing of education

15 8.5 Educational Systems and Development Educational supply and demand: the relationship between employment opportunities and educational demands Education Certification: continuous up-grading of job entry requirements for jobs previously filled with less-educated workers.

16 Analyzing Education: Costs and Benefits, Private and Social Private Costs and Benefits: Private Costs and Benefits: Social Costs and Benefits Social Costs and Benefits

17 Analyzing Education: Costs and Benefits, Private and Social Private Benefits: Private Benefits: Personal empowerment: Personal empowerment: knowledge, skills, learning to learn Lifetime earnings Lifetime earnings Greater potential for participation Greater potential for participation Consumption benefits? Consumption benefits? Private Costs Private Costs Hard work (also maybe a private benefit). Hard work (also maybe a private benefit). Earnings foregone (opportunity cost) Earnings foregone (opportunity cost) Direct costs (fees, supplies, board & lodging) Direct costs (fees, supplies, board & lodging)

18 Analyzing Education: Costs and Benefits, Private and Social Social Benefits Social Benefits Improved productivity benefits all Improved productivity benefits all Improved nutrition, health, child-care spill-overs or externalities, especially from womens education Improved nutrition, health, child-care spill-overs or externalities, especially from womens education Improved potential for tech change and productive entrepreneurship Improved potential for tech change and productive entrepreneurship More effective political participation? More effective political participation? Social Costs Social Costs Resources dedicated to education Resources dedicated to education Opportunity costs to society Opportunity costs to society

19 Investing in Education and Health: The Human Capital Approach Initial investments in health or education lead to a stream of higher future income The present discounted value of this stream of future income is compared to the costs of the investment Private returns to education are high, and may be higher than social returns, especially at higher educational levels

20 Figure 8.1 Age-Earnings Profiles by Level of Education: Venezuela

21 Figure 8.2 Financial Trade-Offs in the Decision to Continue in School

22 Psacharopoulos and Patrinos, 2005

23 Figure 8.6 Private versus Social Benefits and Costs of Education: An Illustration

24 8.5 Educational Systems and Development Distribution of Education Lorenz curves for the distribution of education Education, Inequality, and Poverty Note that formal education systems can worsen income distribution Note that formal education systems can worsen income distribution

25 Lorenz Curves and Gini Coefficients for Education in India and South Korea, 1990

26 Gini Coefficients for Education in 85 Countries

27 Figure 8.4 Youth Rate, 2008 Figure 8.4 Youth Literacy Rate, 2008

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29 Trends in African Education: Gross Enrollment Ratios Primary Secondary Tertiary Source: World Bank, World Development Indicators, 2009

30 MDG Goals and Achievement: Education

31 Participation in Education for Some African Countries, 2007 CountryPrimarySecondaryTertiaryAdult Literacy M F S. Africa Ghana Kenya10650Na Zimbabwe10140Na95 88 Botswana Nigeria Malawi Ethiopia91303Na Liberia All Africa Source: UNDP. Human Development Report, 2007/2008

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33 The Gender Gap: Discrimination in Education Young females receive less education than young males in nearly every low and lower-middle income developing country Closing the educational gender gap is important because: The social rate of return on womens education is higher than that of men in developing countries Education for women increases productivity, lowers fertility Educated mothers have a multiplier impact on future generations Education can break the vicious cycle of poverty and inadequate schooling for women Good news: MDG goals on parity being approached, progress in every developing region

34 School Attainment by Gender: Ratio of Female to Male, Per Cent Region South Asia Middle East and North Africa Sub Saharan Africa Latin America & Carib. East Asia 25% 51% 59% 83% 50% 52% 60% 71% 96% 84%

35 Gender disparity is measured by the ratio of girls to boys enrolled in primary and secondary schools. Most regions are on track to achieve this target by MDG Goals and Achievement: Gender Disparities

36 Educational Issues 1. Achieving 100% primary school enrollments 2. Expanding secondary enrolments 3. Expanding tertiary education 4. Equal access to education for girls and women 5. Child labour and education 6. Relevance of curricula; especially in rural areas; balancing supply of graduates with demand for labour 7. Financial and equity issues 8. Balance among primary, secondary and tertiary education 9. Improving Quality Education, Internal Migration, and the Brain Drain

37 Educational Issues Achieving 100% primary school enrollments; almost complete 2. Expanding secondary education Major achievements so far in these areas: But note Africa: gross enrollment ratios Unevenness of advances among countries Primary Secondary Tertiary

38 Participation in Education for Some African Countries, 2007 CountryPrimarySecondaryTertiaryAdult Literacy M F South Africa Ghana Kenya10650Na Zimbabwe10140Na95 88 Botswana Nigeria Malawi Ethiopia91303Na D. R. Congo85334Na All Africa Source: UNDP. Human Development Report, 2007/2008

39 Educational Issues., continued Equal access to education for girls and women, especially in East Asian and some African countries Why the imbalances? Cultural traditions in some countries; At home tradition for women; Early withdrawal for work at home Income potentials for males vis-a-vis females outside the home? Lack of resources Policy approach of governments Early pregnancies; early marriage Most countries are catching up regarding womens education, quickly enough? A Millennial Development Goal

40 Educational Issues, continued 4. Expanding Tertiary Education High cost High cost Quality issue Quality issue Equity issue Equity issue Brain drain issue Brain drain issue Curriculum relevance? Curriculum relevance?

41 5. Child Labor Child labor is a widespread phenomenon Children need to learn to work; but when does this become exploitative and ant- developmental? Government intervention may be necessary Sometimes this shift can be self-enforcing, so active intervention is only needed at first

42 Other approaches to child labor policy Get more children into school e.g. new village schools; and enrollment incentives for parents Consider child labor an expression of poverty, so emphasize ending poverty generally (a traditional World Bank approach, now modified) If child labor is inevitable in the short run, regulate it to prevent abuse and provide support services for working children (UNICEF approach) Ban child labor; or if impossible, ban child labor in its most abusive forms (ILO strategy;) Activist approach: trade sanctions. Concerns: could backfire when children shift to informal sector; and if modern sector growth slows

43 Educational Issues, continued 6. Relevance of curricula; especially in rural areas Are school-leavers also village- leavers? (Rural brain drain?) Education for Development

44 7. Financial and equity issues How should costs be shared between society and individual for higher education? [Hint: Observe social and private costs and benefits] Educational Issues, continued

45 Public Expenditure per Student per Year as a Percent of GDP pc CountryPrimarySecondaryTertiary Botswana16.1%41.2%440.6% Burundi Ghana Mauritius Niger Rwanda South Africa Canada na USA Source: : World Bank, World Development Report, 2009, Table 2.11

46 Re. 7 and 8: The Issue of Balance and Fairness among Levels of Education

47 8. Balance among primary, secondary and tertiary education What should be the relevant emphases placed on these? Educational Issues, continued

48 Educational Issues, contd: 9. Improving Quality while the systems expand rapidly A Major task. How can this be done??

49 9. Improving Quality while the systems expand rapidly. How can this be done?? Increase resource allocations (from Taxation via economic growth) Easily said, hard to do; Relevamce of economic growth to undergird tax increases and education Better teacher training; better salaries to incentivate good full-time work Improve ability of children to learn (nutrition at school sometimes) Concentrate attention on primary schools ? Reconsider financing for higher education ?

50 E ducation, Migration and various Brain Drains


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