The economics of education is crucial

Franklin Johnston

Friday, September 14, 2012    

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The premise of the economy and education system is the same. If they do not benefit the masses they have failed. A good education system is one in which benefits outweigh "dis-benefits" and the nation is in surplus - economic, social, spiritual. Economically, education does badly. The men who begged me money 15 years ago are still jobless. Socially, has education worked? Are we equal, fair and caring? Spiritually, what's the score? We have a form of godliness but are ethically opaque. Babes in the womb killed; scratch my criss car, make my day; the washer breaks my windscreen if not paid, says he is a minor and can't be jailed; ethical relativism is everywhere - if it belongs to the firm or the state you may steal it. We have more people with schooling and degrees, but fewer with education, manners and principles.

Education economics has been neglected for a generation. Why? Education was treated as charity. Our leaders did not consider value-for-money or effectiveness since education was welfare. Most of us who did education economics left it to make money. Demand and supply, sector and school performance, operations, finance and labour market have not been in our policy or empirical work for decades. Since the 1960s the World Bank has been our education planner and economist via loans and projects. By one 1966 loan, scores of new schools lifted enrolment cohorts by multiples, teacher training doubled; UTech, Instructional TV, media benefited. General economists grew a media profile cached by BOJ, PIOJ, private sector; education economics languished as the "soft" deliverables were opaque. Analysis of expenses, ROI, financing options, resources, input-process-output, logistics, supply chain and deliverables were not done. All education problems were reduced to money. We need more but the crucial need is to know; then to redeploy existing resources as the budget may have the fat to fund this education renaissance. Asinine laws passed by long-gone men now cost us dearly. They removed the ministry's power to make changes even when egregious ills are known. Why can't a teacher be moved from a school with seven kids in class to help another with 50 in class? For one, she works for a school board, the state only pays her.

Still, the smart money is on education. It is the best investment a nation or an individual can make. It pays lifelong dividends. Spend an hour with near centurion Sir Howard Cooke, governor general emeritus, and you sit on the edge of your chair - riveting! His grasp of issues evinces the dividends of education. Education is the most valuable portfolio and English the top stock. English is a gateway to the past, present and future. Maths and science may be mastered via English but the converse is not true. Ronnie says teach English and maths and go for competence, not automatic promotion. If you don't know the capital of Poland but can mensurate, calculate and are literate in English, you will succeed.

The economy and education are both crucial. Most economists study the former, few the latter. School may produce good exam results but educated people are its florescence and drive prosperity. Pundits pore over the economy but not one talks education economics - investing to achieve best education results; ratios of effectiveness; analyses of inputs, outputs and deliverables. Like our economy our education is reactive, "just in time" or always in a crisis. Little is deliberate or planned. Ever heard of a failed education project? No! Yet the results suck. Education may be about teaching a child, but the system is feeding one cow compared to a herd of thousands. The ordinary man is up to date on the economy, devaluation and inflation thanks to talk shows, but knows little of degree devaluation and grade inflation. Media, arise! Who cares for cost-effective, quality education? Efficient schools?

In the 20th century we had significant education florescence but the "good old days"were not all good. The apartheid of the elite schools meant state schools were for the disadvantaged. Barbados is one of the rare ex-colonial systems where state schools were top schools. We flourished because of men like Glasspole and Edwin Allen. Ross Murray and his education officers saw a class going awry, would intervene, take over and teach both teacher and students. They were not bureaucrats and education flowered as teachers were skilled and earnest. Good teachers can make bad systems work and should be among the highest paid. The good old days were good because of their moral force and competence. Old-time teachers can name their students and vice versa. Today many teachers are indifferent to the nameless lumpen. Everybody is passing through a school... "nice to know you, what's your name again? Bye!"

The economics of education are complex. No one speaks of models, variables or variance. We fall below trends and no one asks why? Our elites are dominant yet the sine qua non of the education system is uplifting the massive. Why did serial ministers have no analyses done on the ministry and its dozen-plus subsidiaries? Schools sit on a solid subgrade of $70 to $80b, massive human resources; billions in real estate, complex age-related, ability-tuned systems; billions in soft capital and ICT in a melange which is as viscous and opaque as Hotpot's red peas soup. The network, whose synapses integrate pre-school to adult education, is a minefield. Who knows their critical ratios? Ever had a conversation in acronyms? You can in education. What is the difference between ASEP and ASTEP? The essence of system is connectivity; touch a part and all else is affected, hence the need for sensitivity analyses. A country shapes entities to reach its goals. Ours were the legacy of Empire and aspects were not here. What we saw was not all there was. Education needs economists; finance, systems, HR analysts, demographers, logistics, ICT and supply chain experts. The public sector modernisation group needs to finish the job.


It is facile to think success is automatic. The education economist tracks the big-ticket items - finances, employees, concrete and steel, materiel, process and integrity; the goals, timelines, quality and deliverables. General economists have impacted the economy. The absence of education economists means the society has been under-informed about education and it is undervalued. Our sensitivity to degree devaluation is not honed by as replete a media cover as currency devaluation. Grade inflation is not known like price inflation. After decades of growth up to the noughties we still talk expansion while population values indicate we should retrench, consolidate and redeploy. We have access. The mission of this generation is quality. We are locked into high-cost colonial labour contracts. But for these we could redeploy billions of dollars to early childhood education. Teachers still get two or three years leave on full pay to do part-time study and a locum is paid to take their classes. It's not their fault. They have a damn good union. Our leaders signed the contracts. That they may be earning 125 per cent above market when you add in all the free time and perks is not their fault either. We need to claw back some of this since their schools underperform and the country is broke. Is there an education economist in the house?

In all economics including education, if 80 per cent are performing well, the nation prospers. High-cost, low cohort projects as ASTEP and CAP steal critical resources from regular kids - the difference between fail and pass for many. Why spend some $2 billion on a few thousand second and third-chance kids when tens of thousands need a first chance? We have not done the cost-benefit analyses. Stay conscious, my friend.

Dr Franklin Johnston is a strategist, project manager and advises the minister of education.





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