Meeting the Challenges of Secondary Education in East Asian and Latin American Countries

1
Meeting the Challenges of Secondary Education in
East Asian and Latin American Countries

• Presentation for Kuala Lumpur Secondary Education
  Conference September 19-21, 2005 (Emanuela di
  Gropello)

2
Objectives of the Study

• 1) Examine the key challenges in the delivery of
  secondary education in EAP and LAC
• 2) Suggest a broad range of innovative strategies
  to expand and improve secondary education, with
  focus on
• a) Resource mobilization and
• b) Efficiency of service delivery.

3
Outline of the Report

• Chapter 1 Diagnostic of Secondary Education in
  LAC and EAP countries
• Chapter 2 Understanding Demand-side Constraints
• Chapter 3 Improving Governance and Management
  Structures
• Chapter 4 Mobilizing Resources
• Chapter 5 Improving the Efficiency of Service
  Delivery

4
Diagnostic of Secondary Education in EAP and LAC
countries Chapter 1

• The chapter
• describes the stock of and flow of the quantity
  and quality of education in East Asia and Latin
  America countries and
• analyzes demand and supply-side constraints and
  opportunities (laying the ground for further
  analysis in chapters 2 and 3).

5
Structure of Secondary Education

• Secondary education varies considerably across
  the countries studied. These differences include
• the age of entrance into secondary education
  (lower in LAC)
• the duration of compulsory schooling (longer in
  LAC and upper-middle income countries)
• the length of study (longer in EAP, with an
  average of 3.18 years in lower secondary and 3
  years in upper secondary).

6
Secondary Enrollment in EAP and LAC

• Latin American and East Asian countries have
  rapidly increased primary school enrollment rates
  to achieve near universal coverage. Average
  primary NER in LAC 94 EAP 92.
• But secondary enrollment levels in many Latin
  American and East Asian countries are below
  typical levels given national income.

7
Secondary Enrollment Gap
8
Lower Enrollment in Secondary
9
Differences among Income Groups
10
Internal Efficiency in EAP and LAC Over-age is
an Issue

• Over-age enrollment is a problem in all
  countries, but more so in LAC than EAP, as
  indicated by the GER/NER gap
• LAC GER 80 NER 62
• EAP GER 70 NER 58.
• Over-age enrollment is related to income levels,
  more so in EAP than LAC.

11
Over-age is Pervasive in LAC
12
Over-age Lower at Higher Income Levels in EAP
13
Internal Efficiency in EAP and LAC Low
Completion Rates

• Survival plots show that the likelihood of
  completing secondary varies substantially across
  countries, but is generally low, indicating
  further inefficiencies
• Cambodia 10
• Guatemala 25
• Indonesia, the Philippines, Vietnam, Mexico,
  Brazil about 50
• Thailand and Colombia about 60.

14
Low Survival Probabilities
cambodia
mexico
vietnam
brazil
15
Quality of Secondary Education Varies across
Regions and Income Group, Higher Percentage in
Lower Proficiency Levels in Middle and
Lower-Middle Income Countries
16
Quality of Secondary Education Varies across
Regions and Income Group, Higher Percentage in
Lower Proficiency Levels in Middle and
Lower-Middle Income Countries
17
Scores tend to be Lower in TVET Schools
18
Inequities in Educational Outcomes

• Inequities between urban-rural location and
  income quintile exist in all countries, in terms
  of enrollment, timely enrollment and completion.
• Inequities tend to be higher in LAC countries,
  with about three times as many youth completing
  secondary in the upper quintile than in the lower
  one in Mexico and Guatemala (almost comparable to
  Cambodia in EAP).
• As enrollment increases, inequities have had a
  tendency to decrease in EAP countries, the
  evidence is less clear-cut in LAC.

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Decreased Inequity in Completion Rates (Indonesia)
1998
2003
20
Persistent Inequity in Completion Rates (Mexico)

1998
2002
21
Main Challenges

• Two inter-related objectives
• Expand Gross Secondary Enrollment, Net Secondary
  Enrollment and Completion, in an equitable way
  and
• Improve Quality and Relevance of Secondary
  Education.

22
Supply-side Constraints and Opportunities at the
Macro Level

• Primary graduates (a constraint in low-income
  countries). Primary completion rates lt 70. An
  opportunity in the others.
• Timely primary completion (a constraint in all
  countries).
• Quality of primary graduates (a constraint in
  several countries).
• Demographic trends (favourable in most
  countries). Over the next decade, in all but five
  countries, total population will increase faster
  than the secondary school age population. For
  half the countries the secondary school age
  population will decline in absolute terms.

23
Demand-side Constraints and Opportunities at the
Macro Level

• Increasing demand for secondary education from
  labor markets
• With globalization comes a change in the type of
  labor demand, favoring those workers who have the
  skill sets developed through secondary education.
  
• Innovation and technological advancement require
  a labor force with sufficiently advanced skills.

24
Demand-side Constraints and Opportunities Labor
Market Structures

• A preliminary analysis of household surveys
  suggests that
• In most LAC and EAP countries, labor market
  composition is increasingly based on
  services/sales/trade (more true of middle-income
  countries), which require relevant skills learnt
  in secondary.
• Share of wage employment is also increasing and
  associated with more than 9 years of schooling
  in all countries.
• High rates of return (see Chapter 2).

25
Demand-side and Supply-side Constraints at the
Micro Level

• Low transitions between primary and secondary and
  sub-cycles of secondary in several LAC and EAP
  countries can suggest supply-side (access and
  quality) constraints. Transitions are more marked
  in rural than urban areas.
• In all countries, between 20 and 50 of the
  youth are out of school at 15, suggesting
  demand-related issues, aggravated by over-age.
  

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Understanding Demand-side Constraints - Chapter 2

• This chapter analyzes household demand
• for secondary education, with focus on the
• two main determinants of household
• demand
• expected benefits (labor market returns to
  education) and
• costs (with a focus on opportunity costs).

27
Demand for Education and Private Rates of Return
Substantial Returns

• Private rates of return are higher than 8 in all
  EAP and LAC countries, slightly higher in EAP.
• Rates of return increase with the education level
  in all selected countries, with higher returns
  for technical education and very substantial in
  tertiary.
• Incentives to enroll vary according to the
  secondary modality. Rates of return are higher in
  TVET, but high returns in tertiary make general
  secondary attractive in middle-income countries.
  Importance of secondary-tertiary transition.

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Increasing Returns by Level of Education
29
Demand for Education and Private Rates of Return
Heterogeneity in Rates of Return

• Rates of return decrease with earning quintiles
  in lower-income or lower-middle income EAP
  countries, but increase across earning quintiles
  in upper-middle-income EAP countries and most LAC
  countries (providing little incentive to enroll
  for lower income people).
• The differences per development stage can be
  explained by different labor market structure.
• Increasing returns in LAC could be explained by
  lower quality of the education received by the
  lower quintile. Investing in quality education
  for the poor will be key to expand secondary
  enrollment of the poor in the region.

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Rates of Return Vary per Income Quintile
31
Demand for Education and School to Work Transition

• Opportunity costs can be a strong disincentive to
  continue and/or do well in school. Using detailed
  household survey data, the study will explore
• the extent, intensity, nature, remuneration of
  work in teenagers
• the interaction between schooling and work (age
  of transition to work, school and work, work
  only, school only, neither)
• a characterization of working teenagers and their
  families.

32
Demand for Education and Private Costs of
Schooling

• Initial evidence shows that fees and indirect
  costs of schooling can be prohibitive for
  low-income households across the two regions.
• Regional and development patterns will be
  identified and innovative interventions
  discussed. The LAC case has shown that
  demand-side financing has good potential to
  address opportunity and private costs (e.g.
  Oportunidades in Mexico, Bolsa Escola in Brazil
  or PACES in Colombia).

33
Improving Governance and Management Structures -
Chapter 3

• The chapter analyzes
• Structure of Secondary Education
• Allocation of Functions and Decisions across
  Governments and Institutions
• Impact of Governance Structures

34
Structure of Secondary Education and Implicit
Governance Issues

• Cycles (one vs. lower and upper, basic vs. lower
  and upper)
• Public and/or Private Schools
• General and Vocational Education
• review the status and literaturedeveloping
  countries LAC/EAP
• analyze practices in light of the literature
  review and conceptual framework
• connect to demand side of the youth employment
  equation
• structure of labor markets
• match of demand for skills and what education
  system supplies
• does demand justify significant increased
  investment and separate general and TVET cycles?

35
General and Vocational Education Enrollment
Shares

• The average enrollment share in
  vocational-technical schooling for LAC is 9
  (decreasing), while for EAP it is 11.
• Enrollment share relatively homogeneous in EAP,
  but large differences within LAC.
• In high income countries, 27 of secondary
  schools students are enrolled in vocational
  education, vs. 2 in low income countries.

36
General and Vocational Education New Trends

• Traditionally, in LAC as in EAP, vocational
  schools have been separated out from general
  secondary schools. However, there is an
  increasing focus towards broader and more
  integrated curricula.
• In LAC, vocational secondary education is
  decreasing but there is growth at the
  post-secondary level and an increase in industry
  based training, together with better integration
  secondary-tertiary (Colombia, Chile, etc).
• EAP countries have put more emphasis on
  modernizing existing secondary vocational
  systems.

37
General and Vocational Education Basic Labor
Market Facts

• With the exception of Argentina and Indonesia,
  unemployment rates for secondary graduates are
  below 20 in all countries (lt average rate).
• Unemployment rates tend to be lower for technical
  secondary graduates.
• Between 30 and 70 of secondary graduates are
  wage employed. Shares are higher in middle-income
  countries.
• A deeper analysis of demand for skills is needed
  as well as a cost analysis of alternative
  modalities.

38
Secondary Graduate Profiles
39
Allocation of Functions and Decisions Across
Governments and Institutions

• Relative spectrum of decentralization
• Legal Framework History
• Different Models of Decentralization to
  governments and/or schools
• Government relations to private schools
• Locus of Decision-making focus on
  administration, personnel, quality control
• Implementation Issues
• a. de jure vs. de facto
• b. Weak links in accountability chain

40
Relative Spectrum of Decentralization

• In general, education systems in LAC are
  organized regionally or locally. In contrast, in
  EAP countries there is a tendency towards
  centralized administration of education.
• Schools are decentralized responsibilities in
  both regions (more so in lower income LAC
  countries and middle or upper income EAP
  countries).

41
Locus of Decision-Making
42
Impact of Governance Structures Focus on
Decentralization and School Organization

• Assessment of Accountability Relationships
• School-Based Mgmt School Committees
• Legal Framework, powers member selection
• Analysis of decision-making
• Impact of Decentralization on Outcomes
• Cross-country setting
• Individual case studies

43
Evidence on School Based Management from PISA
2000 and 2003 Analysis

• School autonomy generally higher in Honk-Kong and
  Thailand than in the selected sample of LAC
  countries.
• School boards have slightly larger roles in LAC.
  Principals and teachers have slightly larger
  roles in EAP.

44
Decision-Making Autonomy within Schools Varying
Role of the Different Actors
45
Evidence on School Based Management from PISA
2000 and 2003 Analysis

• Autonomy in teacher management positively related
  to achievement in LAC, but not EAP.
• Autonomy in texts and course contents positively
  related to achievement in EAP, but not LAC.
• Accountability argument more important in LAC
  but local informational advantage argument more
  important in EAP.

46
Mobilizing Resources Chapter 4

• This chapter
• estimates resources needed to expand secondary
  education coverage and financing gaps given
  current expenditure levels, secondary targets and
  growth prospects
• analyzes rationale for public versus private
  intervention in financing the expansion of
  secondary education and
• analyzes alternative options to raise resources
  for secondary education.

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Lack of Priority on Secondary Education, more so
in LAC than EAP

• Within each region countries differ drastically,
  but the two regions are facing similar types of
  challenges increasing gross enrollment rates and
  expenditure on secondary education.
• Expenditure on secondary education is low in
  terms of GDP and per student in both regions
  (more so in LAC than EAP).
• It is low for expenditure per student as a
  percent of GDP per capita in LAC, while high in
  EAP.
• These ratios are lower in low income countries.

48
Secondary Education Shares in terms of GDP are
still Low
49
Expenditure per Student in Secondary is much
Lower than OECD average
50
But Secondary Expenditure per Student in Percent
of GDP per capita is High in EAP
51
Estimated Fiscal Gap for a given GER target and
at current Unit Costs in percent of GDP Higher
Gaps for Lower Middle Income and EAP countries
52
Estimated Fiscal Gap for a given GER target and
at OECD Unit Costs in percent of GDP Higher
Gaps for Lower Income Countries, increasing gaps
for LAC countries
53
Alternative Options to Raise Resources

• Alternative options to raise resources are
  analyzed, looking at
• Public sources
• taxing capacity (LAC and EAP lag behind world
  average on revenue effort even controlling for
  income levels)
• fiscal decentralization
• revenue earmarked to secondary education
  (lotteries, targeted taxes)
• cross-sectoral sources
• re-allocation across education levels

54
Alternative Options to Raise Resources

• Public-private cost sharing schemes
• household and community contributions
• private contributions (firms)
• public-private cost sharing in private schools
• Private resources
• privately funded/managed formal education
  (private schools, private companies funding TVET,
  etc)
• completing financial markets (savings accounts,
  scholarships to poor students, etc)
• informal education tutoring
• International funding.

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Mobilizing Resources Some Lessons

• Countries that achieved significant expansion of
  secondary education share the following
  characteristics
• Use multiple resource mobilizing schemes
• Have moved towards more decentralized systems
• Have incorporated more private funding in
  secondary education delivery
• Have successfully and innovatively mixed public
  and private resources
• Kept per pupil costs under control
• A few case studies of countries which
  successfully expanded secondary enrollment will
  be analyzed to learn on effective resource
  mobilization strategies in specific contexts.

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Improving the Efficiency of Service Delivery
Chapter 5

• Countries could substantially expand and improve
  secondary education with less resource
  mobilization efforts by being more efficient.
  This chapter
• measures cost-effectiveness levels in LAC and EAP
  (output and input efficiency)
• explains efficiency results
• reviews interventions which can be efficiency
  enhancing.

57
Measurement of Cost-Effectiveness

• Cost-effectivenes is measured through DEA
  non-parametric techniques, relating selected
  outputs to one or more inputs (expenditure, or
  physical/human inputs).
• Existing analysis shows no clear difference
  between EAP and LAC countries in
  input-efficiency, but that EAP countries tend to
  be more output efficient in terms of secondary
  enrollment and completion.

58
Input and Output Efficiency Results (Herrera and
Pang, 2004)
59
DEA/FDH Estimation on PISA 2000 Input Efficiency

• Main Findings
• more heterogeneity across LAC countries in terms
  of input-efficiency (low efficiency in Argentina,
  high in Chile and Mexico)
• more homogeneous, but on average slightly lower,
  in EAP countries
• in Argentina and Indonesisa, results are also
  particularly heterogeneous within countries.

60
PISA 2000 Input Efficiency Scores (higher score
is associated with lower input efficiency)
61
DEA/FDH Estimation on PISA 2000 Output Efficiency

• Main Findings
• results are more homogeneous in terms of
  output-efficiency, with slightly higher results
  for EAP
• Chile and Mexico do well also in
  output-efficiency terms, while Brazil does
  poorly
• there is generally more variability within
  countries in LAC than EAP, and variability is
  particularly high in Brazil and Indonesia.

62
PISA 2000 Output Efficiency Scores (higher score
is associated with higher output efficiency)
63
Gains from Efficiency Improvements

• Initial evidence suggests large potential gains
  from input-efficiency improvements. Potential
  gains from output-efficiency improvements are
  smaller, although substantial in some countries
  such as Brazil and Indonesia (by eliminating
  inefficiency, outcomes could be scaled up by
  about 20 in both countries).

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What Explains Efficiency Results and How to
Enhance Input Productivity?

• Impact of different budget shares
• Impact of general vs technical secondary
  education
• Impact of management reforms (school-based
  management, public/private schools,
  public-private partnerships)
• Impact of flexible and innovative delivery models
  of secondary education
• Impact of pedagogical and curricular practices
• Impact of repetition and internal efficiency
  improvements.

65
Impact of General vs Technical Secondary Education

• Vocational and technical education is more
  expensive than general academic school in
  secondary education (by from 1.14 times to 7.20
  times, due to lower pupil-teacher ratios, more
  equipment, etc).
• Technical and vocational schools appear generally
  less input efficient in the PISA analysis.

66
Impact of Flexible Delivery Models

• Alternative models tend to have lower per student
  costs than conventional schools even while
  providing access to populations and areas that
  are typically more expensive to serve.
• Three main types of alternative secondary models
  are Distance Education Open Learning and Group
  Study.
• International evidence suggests that these models
  can work for specific target populations.
  Successful cases in LAC and EAP will be more
  thoroughly analyzed and some systematic lessons
  extracted.

67
Impact of Management Structures

• Initial evidence suggests that schools with
  higher decision-making autonomy in human
  resources are more output efficient in LAC
  countries.
• Private schools tend to be more efficient,
  although more so in LAC countries.

68
Impact of Pedagogical/Curricular Practices

• Initial evidence suggests that schools using
  external assessment practices are more output
  efficient in Brazil, Thailand and Honk Kong.
• Improving the alignment between different parts
  of the system to ensure smooth transitions
  between sub-cycles and cycles (case study on
  Malaysia) is another promising intervention.

69
Impact of Reduced Repetition

• By decreasing repetition in primary and
  secondary, over-age decreases, early drop-out
  decreases and educational attainment increases.
  The NER increases as well.
• Reducing repetition can also, potentially,
  provide important savings
• initial evidence suggests that repetition, and
  the cost of repetition, are higher in LAC than
  EAP and in primary than secondary education. In
  total, LAC countries could save over US 2
  billion per year by eliminating repetition at the
  secondary level, savings are less substantial in
  EAP.

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Cost of Repetition High in LAC
71
Impact of Reduced Repetition

• Issues how can repetition be reduced ? What is
  an advisable repetition level ? What is the
  likelihood that reductions in repetition
  translate into actual cost savings ?
• A case study is being undertaken on two countries
  in EAP and LAC (Cambodia and Chile) which have
  successfully decreased repetition in secondary.
  The policy combinations to achieve this reduction
  are analyzed, as well as the consequences of this
  decrease on coverage and quality indicators, and
  on costs.

72
Some Emerging Messages

• Several challenges have emerged in secondary
  education in both EAP and LAC, related to low
  coverage, completion and quality.
• Coverage and quality challenges are
  inter-related.
• Challenges are more acute in lower income
  countries.

73
Some Emerging Messages

• Significant demand for secondary graduates (both
  general and technical), although household demand
  is still constrained, in particular for lower
  income youth in LAC (contributing to explain
  higher inequalities in LAC).
• Technical-vocational secondary education can be
  effective but is more costly. More analysis is
  needed on relevance of TVET and general education
  to labor market needs and relative costing.

74
Some Emerging Messages

• There is scope for mobilizing more resources for
  secondary education, while also improving the
  efficiency of service delivery in both EAP and
  LAC
• Secondary education in under-funded in both EAP
  and LAC (more so in LAC and in lower-income
  countries). Fiscal gaps are substantial for
  lower-income and lower-middle income countries
  and for both EAP and LAC
• Scope for input-efficiency improvements in all
  countries, although more so in EAP than LAC
• Also scope, although less so, for
  output-efficiency improvements, more so in LAC
  than EAP and in lower-middle income countries.

75
Some Emerging Messages

• A broad range of options need to be looked at to
  mobilize resources and improve efficiency
• Options to mobilize resources include using
  multiple resource mobilization schemes,
  decentralized financing, and innovative
  public-private resource mixes.
• Possible options to improve output and input
  efficiency include school autonomy, flexible
  delivery models, use of assessment practices and
  a decrease in repetition (more so for LAC).