Education and The Market: Clarifying The Stand

Education produces social good, goes the argument, and therefore, the society should pay for it, argues the advocates of public education. On the other side are the policy wonks who sees education as a tool to build private capabilities, leading to private wealth. Between these two positions, there are lots of people, who apparently hold contradictory positions. For example, the For-Profit entrepreneurs and the Private Equity that sees a great money-making opportunity in education believe that education should be for private wealth but the state should pay for it (so that the market remains big enough for them to invest), and those professors in different schools who would continue to think that the students should care for social good above all despite having to shoulder all their debts.

One such position is to see education as a social good even if it creates individual capability and prosperity. We have now come to see that inclusive political and economic institutions as the only sustainable basis of a society's prosperity, and education helps us build that. The previous theories about prosperity, which was subscribed to by both the right and left, is that prosperity is built on extractive accumulation. The key idea behind imperialism, and for the Soviet theorists like Bukharin, was that surplus of value must be extracted and accumulated by careful design of power and terms of exchange to create prosperity. However, this is a somewhat zero-sum view of life which we have come to reject (though this is one of the central tenets of Marxist theory), and come to subscribe, en masse, to the view that prosperity is a result of technological progress. And, this technological progress hardly happens without social progress, the ability for the common person to hold their elite accountable and the ability for anyone with a good idea to challenge the incumbents and start an enterprise. Therefore, inclusion, not accumulation, has come to be regarded as the central driver of progress and prosperity.

Education remains at the core of this formulation: The inclusive political and economic institutions can't happen without people being educated, both to participate in politics and to be economically productive. In this sense, the supposed dichotomy of the education isn't a dichotomy at all. And, for those advocates of public education battling the market, the fact remains one needs education for the functioning of the market.

We need to reframe this debate, therefore. Markets, in their true, inclusive, sense can't function without an equitable, accessible system of education. This is not about a market to deliver education, but an education system underlying the efficient functioning of the market, which should be publicly provided. Public providers have, however, the responsibility to see that the students can participate in the market effectively - and should therefore be thinking about economic productivity rather than leading a crusade against it - and this should lead to a new debate about the shape of public education.

This leaves us with the argument of introducing the market in education as a way of generating efficiency. While this is being tried in several countries, in many ways, education remains pre-market. The accessibility principle is often violated by introduction of markets, and instead of creating efficiency, market competition brings unnecessary corruption in education in the form of misinformation, grade inflation and short-termism. The current regulatory approach, which sees market as a panacea and tries to introduce business-like operations even with non-market players, gets it wrong all too often: What one needs is a regulatory system which can introduce long term thinking even with the market operators, not the other way around.


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