Harry arry Anth thony Patri trinos 4 Sep eptember r 2019 2019 @hpatrinos
In Introduction – Glo lobal • Since 1980s returns to schooling increased • Returns to education were highest for primary • Recent evidence suggests pattern changed • Returns to tertiary education increased most
The Global Education Revolution 10 8 Years of schooling 2.5 1.5 1900 1950 2000 2050
An Education System Empowering All ll to Reach Their Full Potential ECA Education Vision
Tertiary ry Education
“A highly -skilled workforce, with a solid post-secondary education, is a prerequisite for innovation Tertiary ry and growth: well- educated Education people are more employable, earn higher wages, and cope with economic shocks better”
Expenditure on Tertiary ry Education (% of government expenditure on education) 22 21 21 21 18 12 SA EAP LAC SSA World ECA
Tertiary Education In Increasing
Global Enrollment in Tertiary ry Education is In Increasing (millions of students) 250 200 150 100 50 0 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Tertiary ry Enrollment Rates by Country ry In Income Group 80 70 60 50 40 30 20 10 0 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 World High income countries Upper middle income countries Lower middle income countries Low income countries Source: UIS database
Tertiary ry Education Enrollment Rate by Region 80 70 60 ECA 50 LAC MENA 40 EAP 30 SA SSA 20 10 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Tertiary ry Enrollment Growth by Region 2000 to 2017 EAP, 199% SA, 184% LAC, 124% SSA, 107% MENA, 101% ECA, 53% 2000 2017
100 120 140 20 40 60 80 0 Uzbekistan Luxembourg Azerbaijan Tertiary Tajikistan Moldova North Macedonia Kyrgyz Republic Kazakhstan ry Enrollment Rates by ECA Country Slovak Republic Romania Hungary Malta 2016 (or latest available) Armenia Georgia Montenegro Switzerland United Kingdom Cyprus Albania Serbia Portugal Italy Sweden Czech Republic France Poland Croatia Germany Lithuania Bulgaria Estonia Iceland Belgium Ireland Slovenia Netherlands Norway Latvia Denmark ry Russian Federation Austria Finland Belarus Spain Turkey Greece
Returns
Are There Returns to Schooling? Private: • Cost-benefit analysis • Value of lifetime earnings to net present value of costs • Costs: student’s foregone earnings while studying & fees • Benefits: extra earnings compared with $ More educated someone with less education +++++ +- Less educated - - Age
Private Rates of Return to Education Risi ising Retu turns 1970-2013 Retu turns to Sc Schooli ling by y Le Level l (L (Latest) 17 10 6 Primary Secondary Tertiary
Returns Higher for Women – Global 17 15 12 11 10 10 8 Men 7 Women Overall Primary Secondary University
Global Changes in Returns to Education since 1980 Men Women 1.20 1.20 1.00 1.00 0.80 0.80 0.60 0.60 1980 1990 2000 2014 1980 1990 2000 2014 Primary Secondary Higher Primary Secondary Higher
Returns to Schooling in ECA 20 20 18 18 16 16 14 14 12 12 10 10 8 6 4 2 0
Returns to Schooling in ECA 10 8 6 4 2 0 2000 2002 2004 2006 2008 2010 2012
Returns to Schooling & Growth in ECA 10 6 2 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 -2 -6 Returns Growth
Enter Technology
Type of f Skills Demanded Changing 70 Nonroutine analytic 65 60 Non routine interactive 55 Routine Manual 50 Routine cognitive 45 Nonroutine Manual 40 1960 1970 1980 1990 2002
Automation is Coming
Robots are Coming
Estimates of f Jo Jobs At Ris isk fr from Automation Vary ry
In Industrial Jo Jobs are Falling in West & Rising in East
40 The Race Between Education & Technology in ECA 35 30 25 20 15 10 5 0 1960 1970 1980 1990 2000 2010 Higher education (%) Returns to university
• Efficiency • Inequality Im Implications ➢ Education reform ➢ Financing reform
Private and Social Rates of f Return to Tertiary ry Country Private Social Poland 26.6 13.9 Czech Republic 19.9 15.3 Turkey 19.3 9.2 Ireland 17.0 15.4 Spain 9.8 6.5 France 9.5 6.9 Italy 9.5 8.6 Finland 8.4 6.1 Denmark 7.9 3.9 Netherlands 7.5 6.8 Average 12.8 9.5
Private Share of f Tertiary ry Education Financing 100% United States Australia, Japan United Kingdom, Spain . Most of continental Europe 0%
Over-representation of f University Students whose Father is a University Graduate Country Index Germany 2.1 Spain 1.5 France 2.0 Ireland 1.1 Italy 1.8 Netherlands 1.6 Portugal 5.4 Finland 1.8
How to Finance University Use Future Earnings Innovative Student Finance • Income Contingent Loans • Human Capital Contracts
Human Capital Contracts: How They Differ Graduate payments Graduate income
Human Capital Contracts: How They Differ Graduate payments Graduate income
Better In Information
Messages • Finance • Quality • Measure/Inform
Europe and Central Asia
1.0 0.9 FIN IRL SWE NLD DEU AUT SVN Productivity Relative to Benchmark CZE GBR 0.8 PRT DNK NOR ITA CHE FRA BEL SRB CYP KAZ POL EST ESP ISL RUS HRV LVA LTU HUN SVK LUX Human Capital GRC 0.7 BGR UKR TUR ALB BIH MNE GEO ROU AZE Index In KGZ MDA 0.6 ARM XKX TJK MKD 0.5 Most ECA 0.4 countries perform 0.3 above average for 0.2 income level 6 7 8 9 10 11 12 ln [GDP Per Capita in 2017 or latest PPP( constant 2011 international USD), World Bank]
581 563 563 562 Top HLO 548 (H (Harmonized 545 542 Learning 538 538 537 Outcomes) Kazakhstan Russian Ireland Estonia Macao Finland Hong Kong Korea, Japan Singapore Federation SAR, China SAR, China Rep.
Number of f top 500 universities among international university rankings Country QS Shanghai US News Times United States 94 137 133 123 China 22 57 130 14 United Kingdom 51 39 42 58 Germany 30 36 36 44 Japan 17 14 67 13 Korea 15 11 45 10 Italy 12 15 27 25 France 17 19 19 21 Netherlands 13 11 13 13 Spain 13 10 14 8
Top 10 PIA IAAC (a (among those of f university age) 633 628 626 622 620 615 615 606 605 603 Finland Netherlands Austria Sweden Belgium Germany Japan Norway Estonia Denmark
Tuition Fees (average annual BA level fees charged by public institutions by region 8000 Equivalent USD converted using PPPs for GDP 7000 6000 5000 4000 3000 2000 1000 0 LAC North America EAP MENA ECA
ECA: Lending and Strategy
Tertiary ry Education Portfolio In Increasing Share of Tertiary Education Lending in Total ECA Education Portfolio (5 years moving average) 35% 30% 25% 20% 15% 10% 5% 0% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
World Bank Support for Tertia iary ry Education in in ECA • Support for tertiary education Number of tertiary investment reforms & innovation since 1972 projects by main objective area • Collaboration with governments, Access/equity tertiary institutions, partners, others Governance/Financial Man • Portfolio between 2000-2018: Teaching/Learning • 36 projects (USD 514 million) Market relevance • Numerous analytical and advisory tasks Research Quality Assurance • 4 projects in pipeline for 2019-2020 Competitiveness Knowledge economy EMIS 0 1 2 3 4 5 6 7 8 9
Selected Examples Lending: • Uzbekistan MHEP : $42 million. Focus on HE management; learning environment; relevance of HE; HEMIS • Montenegro HERIC: $16 million. Reform, innovation, finance, quality assurance, R&D • Belarus HEMP (under preparation): $100 million. Focus on Bologna implementation (joined 2015) – especially QA, curriculum reform; improved environment for teaching, learning, research Analytical and advisory work: • Latvia HE RAS (different phases 2013-18). Focus on HE financing and governance (system and institutional level), academic careers. • Romania HE RAS (different phases): Included work on quality assurance, transition from secondary to tertiary, early warning prevention dropouts Technical assistance: • Regional HE dialogue for Poland and the Baltics (FY16-18): Incl. regional roundtables on HE topics of join interest (financing, internationalization, etc.); knowledge sharing; publication on Performance Contracts
Going Forward Towards an ECA Tertiary Education Approach Quality + Modernization + Funding + Autonomy/Accountability Flagship with strategic directions at the regional level
Harry ry Anthony Patrinos World Bank @hpatrinos
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