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The Competitive Market in Public / Private Education.

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Presentation on theme: "The Competitive Market in Public / Private Education."— Presentation transcript:

1 The Competitive Market in Public / Private Education

2 Driven within OECD countries by endogenous economic growth theories that identify Public Education Reform as key to: increasing the productive and allocative efficiency of human capital development increasing national economic growth through expansion of the service sector increasing service sector exports - public education products and services increasing the level of technology transfer

3 Fiscal Policy Reform: decrease government financing of public education increase opportunities to derive government revenue from public education through valued added taxes, goods and services taxes, export revenue Monetary Policy Reform: follow principles of Modern Public Debt Management shifts public education financing to the capital markets to reduce the level of public debt government provides credit enhancement and other guarantees to attract investors to public education sector equity and debt financing Structural Policy Reform: Create Markets government regulations and laws that ensure the development, ongoing operation of, and investment in, public education as an industrial sector – competitive international Public Education market

4 Endogenous economic growth theories suggest competitive markets as the most efficient mechanism for ensuring economic growth OECD countries systematically move public education from a government monopoly to an internationally competitive sector of the economy

5 OECD governments use structural reform policies to develop competitive international markets to provide the incentives and discipline necessary for Public Education Reform to achieve: human capital productive efficiency human capital allocative efficiency export oriented economic growth technology transfer decreased levels of government debt effective utilization of capital competitive advantage

6 Step One: Education Laws and Regulations Necessary for Functioning Markets Monetization – establish fees/prices for public education markets to develop Re-regulation – allow private and for-profit public education services Assign Property Rights - intellectual property, copyright, ownership within public education Step Two: Capital Market Financing of the Public Education Market Government Financing of Private Enterprise within Public Education: Technology Transfer Capital Market Financing – Equity: Private Education Companies, Bonds: Public Universities and Securitization: Student Loans Government attracts investors through loan guarantees and credit enhancement Step Three: Government Development of a Competitive Domestic Market Government funds cost recovery programs and vouchers in public education systems Government funds private education start ups – private K-12 and postsecondary institutions Step Four: Government Develops Export Markets Government supports international marketing of education products and services Step Five: Government Locks In Public Education Exports – Irreversibility International Trade Agreements / International Investment Agreements for Public Education

7 Competitive International Markets in Public Education increase: Human Capital Productive Efficiency development of the productive capacity of labour in all areas of the national economy through the development of a lifelong, seamless, quality education system Human Capital Allocative Efficiency mobility of students, faculty and staff between domestic and international education institutions and programs articulation, recognition and transfer of qualifications between domestic and international education institutions domestic and international qualification frameworks to support labour market mobility of all workers cross border trade of education goods and services to increase the opportunities for, and quality of human capital development

8 Competitive International Markets in Public Education increase: the size of the service sector of the national economy by increasing the demand and supply of domestic and international public education products and services the value of national economy through exporting public education products and services and importing quality foreign public education products and services, developed in a fully regulated, competitive international market in public education ongoing growth of the public education domestic and export market through product differentiation, price differentiation and aggressive, government coordinated and funded marketing strategies

9 Competitive International Markets in Public Education increase: intentional actions of people to improve themselves – lifelong learning improvements in organizations – quality management systems levels of innovation – Research & Development productivity – less cost per unit, new and improved methods efficiency – lower transaction costs, increase transparency, eliminate barriers to entry and exit knowledge transfer – eliminate systemic, administrative, social, political or ideological obstacles to communication, distribution, and adoption of beneficial technology

10 OECD countries have competitive advantage in the International Markets in Public Education: First mover advantage (United States, United Kingdom): identified public education sector as a new area for liberalization and instituted market development program in the 1970s – high level of exports to developing countries Late developers (Canada, Australia): catching up with first movers since the 1990s by following their development strategy – increasing exports to developing countries Non developers (Non – OECD countries) have had their domestic public education market increasingly served by international competitors – imports only

11 OECD Governments support competitive advantage of their Public Education product and service providers United States Information Service: 211 offices in 147 countries to promote U.S. education and training services Australia: 30 overseas education offices as early as 1996 launched a $700 000 promotional campaign in key Asian markets, and committed $18.5 million to promote its education and training services internationally British Council: most successful country – markets UK education and training services coordinated, on­site, central approach to international marketing 228 offices and 95 teaching centres in 109 countries estimated that education and training exports account for 4 percent of invisible exports of the UK economy France: Alliance Française has 1,058 associations in 132 countries acts as an indirect marketing channel for French education and training services

12 Current UAE Public Education Reform reflects the effectiveness of OECD Public Education Reform: provides a regulated market for international competitors retains government national public education institutions allows foreign direct investment allows cross border trade regulates public education market participants provides increasing levels of transparency to eliminate information asymmetry supports technology transfer supports the allocative and productive efficiency of human capital development buys / imports public education products and services

13 Follow the OECD Public Education Reform approach? Decrease government expenditures and increase government revenue as a result of public education reform ? Government and/or capital market financing of public education reform? Import and/or export of public education reform products and services? Develop internationally competitive UAE Public Education products and services through public education reform? Continue to develop these Public Education Reform activities? Elimination of Information Asymmetry - Rankings Quality Assurance - Government, Third Party Inspections International Institutional Accreditation International Teacher Professional Accreditation International Curriculum Standards World Pricing and/or government subsidies Product Differentiation, 1 st, 2 nd, 3 rd, 4 th degree Mobility – Internationally aligned National Qualification Framework for Articulation, Recognition and Transfer Lifelong Learning - Portfolios

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