Why Invest in the Private Sector? - World Bank · Why Invest in the Private Sector? 7 1. Challenge...

EDUCATION STAFF DEVELOPMENT PROGRAM – Global

EDUCATION STAFF DEVELOPMENT PROGRAM

Why Invest in the Private Sector?

Harry Anthony Patrinos The World Bank

May 8, 2014

1



2

1. Challenge of ensuring learning for all

2. Growth in private sector engagement

3. Evidence revolution


Increased Focus on Measurement

3

TIMSS

PISA


Growing Market for Education

4

2

4.5

1999 2013

Education expenditure ($ trillion)


Education Spending

5

AustraliaBulgaria

Colombia

Czech Republic

Denmark

Germany

Greece

Hong Kong

Iran

Japan

Korea

Lithuania

Netherlands

Norway

Portugal

Romania

Singapore

Slovak Republic

South Africa

Spain

Sweden

Switzerland

Thailand

United States

300

400

500

600

700

0 2 4 6 8

Public spending on pre-primary, primary, and

secondary education (% of GNP)

Med

ian

mat

h sc

ore

TIM

SS

me

dia

n m

ath

sco

re


Teacher Absenteeism

6



7


2. Growth of private sector engagement


Private Sector Growth

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0%

5%

10%

15%

20%

25%

1990 2000 2010

Private enrollment as % of total student enrollment

Source: World Bank 2013

Low income countries

Middle income countries

High income countries


Type of Provider

9

Provider Example Government

Traditional public schools

Faith-based

Madrasas Fe y Alegría schools in Latin America

NGO BRAC schools in Bangladesh

Community EDUCO schools in El Salvador

Private, for-profit

Bridge academies in Kenya Omega schools in Ghana Beaconhouse schools in Asia


Public, Private & Mixed Goods

10

Pure Public Good Mixed Good

Mixed Good Pure Private Good

More Nonexcludable

More Excludable

More Rival More Nonrival

Mixed Good

Pure Private Good Mixed Good

Pure Public Good

•food, clothing

•sold-out movie

•crowded highway

•software

•movie with empty seats

•uncrowded highway

•urban park

•national defense

•crowded city streets

•fish in international waters

Why Public Intervention?

EDUCATION STAFF DEVELOPMENT PROGRAM – Global 11

http://www.google.com/url?sa=i&source=images&cd=&cad=rja&docid=E7NnriuPEXRP5M&tbnid=q3GtJ0bWSEgJyM:&ved=0CAgQjRwwAA&url=http://www.logodesignlove.com/human-rights-logo-selected&ei=r89-UrODFK-z4APIioHoDw&psig=AFQjCNFA06ITlSzYaaFS47W2IKmQnojYIQ&ust=1384128815362617

http://www.google.com/url?sa=i&source=images&cd=&cad=rja&docid=qwXTAh1gPZBZ9M&tbnid=p9yN-3e_ce8tdM:&ved=0CAgQjRwwAA&url=http://environmentaleconomics.wordpress.com/2010/05/02/module-v-market-failure/&ei=2s9-UqeNAYPi4AOH54GgDA&psig=AFQjCNF9JnUFzLXFvDNRlakkBlWLtnSwEg&ust=1384128858051955

http://www.google.com/url?sa=i&rct=j&q=&esrc=s&frm=1&source=images&cd=&cad=rja&docid=aeVfgnfiDUJNxM&tbnid=hBOt1Hq6uqLo3M:&ved=0CAUQjRw&url=http://www.coe.int/t/dg3/&ei=HNB-Uu6KNbDlsATar4HgBg&bvm=bv.56146854,d.dmg&psig=AFQjCNHrJQdiRVSks5fkm0mwe8sF9ap5HQ&ust=1384128918393221

Government Intervention…


…need not be provision…

…nor even finance…

Government Intervention…



Finance-Provision Matrix

14 Patrinos et al. (2009)


Private Engagement across Countries

15 Source: Baum et al. (2013)

Economics of Education


(1930-2014)

Economics of Vouchers


Public Schools & Vouchers

Current system of education

• Families purchase public or private education, subject to budget constraint

With a voucher

• Parents that choose public no worse off

Parents that switch

• Able to consume more schooling and other goods




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2. Growth of private sector engagement



Evidence Revolution | Advances

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School Choice in the Netherlands



Evidence Revolution | What Works

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1/3 to 1/2 SD in English by grade 8

0.12 SD; for special education & limited English students: 0.3 - 0.4 SD

0.09 - 0.17 SD (English) 0.18 - 0.54 SD (math)


Good Charters use No Excuses Model

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Frequent teacher feedback

Data to guide instruction

High-dosage tutoring

Increased instruction time

High expectations

Traditionally collected input measures:

• Class size

• Per-pupil expenditure

• Teacher certification & teacher training

What Doesn’t Work



Concession Schools

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Public School Ciudad Bolivar, Bogotá,

Colombia

Concession School Ciudad Bolivar, Bogotá,

Colombia


Concession Schools

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Enrollments

0

5000

10000

15000

20000

25000

30000

2000 2004

Drop out Outcomes

Direct

Indirect

-2

-1.6

-1.2

-0.8

-0.4

0

Direct

Indirect

Reduction in dropout rates, 1999-2003 (% points)

Math

Reading

0

1

2

3

4

5

Increase in test scores, 1999-

2003 (% points)

Targeted Vouchers: Colombia Indicator Voucher students were:

Schooling 10 pts more likely to finish grade 8

Grade repetition 6 pts less likely to repeat

Test scores 0.2 SD higher

High school 5-7 pts more likely to complete

College exam 15-20% more likely to take

College scores 2 pts higher

Work 3 pts less likely during study

Delay marriage 1 pts less likely

Universal Vouchers: Chile

• Expansion of schooling

• Mixed evidence on learning (Urquiola; Sapelli, Gallegos)

• New evidence on long term impacts (Patrinos, Sakellariou; Bravo,

Mukhopadhyay, Todd)



Pakistan Foundation Assisted Schools

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Public financing & private provision to reach poor

households

Results-oriented approach to raise

educational outcomes


Andhra Pradesh School Choice Project

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BRAC Education Programme

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Investing in Private Sector | Concerns

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Public divided on issue of school vouchers

Remain controversial

Opponents of voucher system fear:

• Only poorest of poor would be left in public schools

• Beneficiaries would be high income families

• Funds would be drained away from public schools


Key Features of Successful PPPs

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Appropriate legal / institutional framework

Well-informed decision making

Clear / detailed contracts

Open, competitive, transparent procedures

Predictable regulatory environment

Appropriate sharing of risks

Well developed administrative structures


Investing in Private Sector | Summary

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Tailored to country circumstances

Not a panacea

Regulatory environment important

Think broadly about role of government

More evidence needed

Implementation


More Evidence

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300 impact evaluations

http://datatopics.worldbank.org/EdStatsApps/Edu%20Evaluation/evaluationHome.aspx?sD=E

http://datatopics.worldbank.org/EdStatsApps/Edu Evaluation/evaluationHome.aspx?sD=E

Why Invest in the Private Sector? - World Bank · Why Invest in the Private Sector? 7 1. Challenge...

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