The Global Education Industry: Lessons from Private Education in Developing Countries

Private Enterprise Provides Superior Education Alternatives Worldwide


After all the privatizations of the Thatcher years, the British-maintained school system is one of the two largest industries that still remain under state ownership and control. (The other is the National Health Service.) Both are effectively monopolistic and therefore liable to all the notorious faults of monopolies, particularly those run by the government. State education in Britain is not strictly speaking a monopoly because the private provision of educational services is permitted and exists on a relatively small scale. But is there any anti-monopoly legislation in the world that would not be activated if a firm achieved a market share of over 90 percent and kept it through a policy of predatory non-pricing?

James Tooley, the author of the present work, opened his campaign for the privatization of educational institutions in 1995 with the publication of his first book, Disestablishing the School: Debunking Justifications for State Intervention in Education. His second book, Education Without the State appeared a year later. Those works firmly established Tooley’s credentials as an educational radical and earned him the enmity of the education establishment.

The current book was initiated, as we are told in the foreword, by “the International Finance Corporation (the private-sector arm of the World Bank Group),” which “had become aware of the potential to participate in private sector educational investments”—most especially in developing countries. What an unexpected development, given the World Bank’s usual inclinations to support state institutions.

The findings of this study are astonishing and should prove invaluable to all of those in the United States who are working to privatize and introduce competition into the provision of education services. In Brazil, for instance, there are seven or eight large chains of private schools, several of which also run universities and sometimes educational television stations.

Not only is the private sector large in Brazil, but it is also strikingly innovative. The most dramatic example of this is provided by the COC chain. For fees of about $4,800 a year, it provides each student with a specially devised desk with a fold-away computer terminal networked to CD-ROMs, the Internet, and the teacher’s “smart-board,” a device that enables the student to take home a copy of all the teacher’s blackboard writings on a floppy disk.

An example of the willingness and versatility of educational enterprisers comes from India, where computer training in the state universities is poor, producing graduates who are unemployable in today’s computing industries. Private enterprise in the form of NIIT (the National Institute for Information Technology), however, offers superior training in its 400 campuses around the country, and employers now regularly state in their job advertisements that they are seeking a GNIIT—a graduate of NIIT.

Two other features of NIIT are especially instructive. First, because of the need to earn a profit, NIIT is acutely aware of the value of time and space. On NIIT campuses, all rooms and computers are in use constantly from morning to night—very different from state institutions! Second, NIIT has two research departments devoted solely to education. Their performance indicators are publications in research journals and attendance at conferences. NIIT is convinced that the work of their researchers will pass the test of the market, and if not, changes are bound to be made. Again, how different from the “research” usually done by academics in government universities.

After his chapter surveying the development of private education alternatives in 13 developing countries, Tooley proceeds to chapters on “Factors for Success,” “Equity Issues,” “Regulation and Investment Climate,” and “Conclusions and Policy Proposals.” In “Equity Issues,” we are unsurprisingly told that for-profit suppliers in developing countries, as in the developed, mainly serve the middle and upper classes. But in developing countries there are also some services geared toward the poor.

Tooley notes “how total public spending on education in low-income countries typically favours the affluent, and can often be a subsidy from the less well off to the higher income groups.” Indeed it can, as it tends to be in high-income countries too. But if the private market for education continues to develop, with more and more people paying for just the education they choose, the “rob the poor to give to the rich” phenomenon will dissipate.

In helping to undermine the intellectual support for government education and, in the current book, demonstrating that private enterprise is providing superior education alternatives for people around the globe, James Tooley has done truly valuable work. []

Antony Flew is emeritus professor of philosophy, University of Reading, England.


September 2000

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