Recently the Australian Government produced a large report into its school funding arrangements. William Isdale over at Oxford’s Practical Ethics blog has examined the review and argued that it neglects the harm of funding private schools even when parents are making big contributions to those schools.
He could well be right that we should target a greater share of funding on disadvantaged children, but he takes us through some common silly arguments to get us there. I’ll look at them across a few short posts.
First Isdale notes that,
“…there are in fact reasons to subsidise private education in some instances. One reason is that education is a public good; a society of well-educated people is better than one where people are never afforded those opportunities.”
Reasonable enough. On the other hand,
“…education is a positional good as well as … one with public benefits. Access to rewarding jobs is to a large extent (but not wholly) a zero-sum game. If someone lands a great job, someone else misses out. Since education is one of the main ways in which we land such jobs and win out over others, there are good reasons for believing that its advantages should be based on talents and not money. Not doing so is not only unfair, but it’s bad for society.”
This substantially underestimates the extent to which education is a positive sum game in a dynamic economy like our own. At the individual level when one person becomes more educated and takes a highly skilled job from another person, it looks as though one person’s gain has been another person’s loss. But if you look across countries and times you see some places where the vast majority of workers are poorly skilled and most jobs require few skills, and others where most of the population is highly educated and the economy has adjusted to make use of most of those skills. As their population became more educated the Swedes for instance didn’t just redistribute a fixed share of professional jobs between themselves – businesses that demanded professional employees opened and expanded. Jobs that had previously been done by those those with low skills were now done by machines and immigrants, and in some cases those jobs disappeared altogether (for example, it’s rare to hire housemaids or shoe-shiners today). Most people in a country can have high skilled and high paying jobs if they have the required talent and education, and employers are given time to adjust to make use of the skills they have. I would reverse the order and say that access to rewarding jobs is to a large extent (but not wholly) a positive-sum game.
To be fair to Isdale, while access to rewarding jobs is positive sum, the status associated with being a wealthy professional is more of a positional (or zero sum) good. A wealthy engineer will feel less special when 10% of the population are wealthy engineers than when 1% of the population are. Discouraging education spending to defuse this zero-sum competition might would sense if people would then redirect their efforts to other more positive-sum activities. However I don’t see what those other activities are meant to be. Most things people can do with their time, even overall helpful ones, have some competitive element to them. Becoming more skilled and educated seems about as useful for society as anything most people do.
On the face of it Isdale’s case contradicts itself. If having the people around you become better educated is overall a negative externality as he seems to suggest, then we should be taxing education rather than subsidising it. But Isdale wants us to subsidise it more, at least for disadvantaged groups! We can make sense of his position if we assume that education spending for an individual is initially a positive externality for the rest of society, but then as the spending goes up, becomes a negative one. This could be true if education spending is initially about learning skills, but at higher levels just serves to help students signal their distinguished pedigree to future teachers and employers. Unfortunately he never gets around to making that case. My understanding is that we struggle to measure the externalities from education at all, so it would be hard to convincingly mount an empirical case for such a precise claim.
Tagged: economics, education, ethics, public policy
