EDUCATION AND THE STATE

- Arjun Bannerjee, LSS, Kolkata, 2007

Education is typically viewed synonymously with formal schooling. Over the past century, state-provided schooling has become the norm for the industrialized world. Yet, public choice scholars continue to ask normative questions regarding the desirable role of the state-specifically, what role should the state play in providing access to schooling and does the consumption of schooling generate externalities that require a state role in provision?

Schooling fosters the development of human capital and influences the individual’s lifelong choice set. Thus, it is perceived as an economic good, whose consumption today influences future pecuniary and non-pecuniary wealth. In a pure market setting, parents consume schooling for their children if they choose to allocate current resources for benefits that will be reaped by their children in the future.

With no interventions, a pure market outcome in schooling implies that the most disadvantaged in society would consume disproportionately small amounts of schooling because of current resource crunches. Left to the market, the poor will consume schooling in smaller amounts than the wealthy and the financial position of children at birth will influence lifelong income and wealth independent of factors such as ability or work effort. In its simplest form, sate protection of the poor provides a guarantee of income to insure that the poor consume schooling but it does not answer the specific way in which this protection should be provided.

As the role of the state began in the 1800s and evolved throughout the 20th Century, state protection in most of the developed world has translated into both financing of schools and provision of schooling. Decisions regarding finances, curriculum to teach, the teachers to hire, the books to use, etc., all fall under the jurisdiction of the state. Of particular interest to public choice is that the single greatest defect of public schooling that characterizes the maturation of state-provided schooling has been its failure to provide universal education in India. Nobel laureate Amartya Sen has gone on record suggesting that primary education, especially at the grassroots level should be considered a most important function of the state. Economic and social progress will depend directly on the proliferation of education. For example, even though private schools are expensive, people who can afford it make a beeline for sending their wards to these institutions rather than less expensive government schools, which are generally not known for their facilities and academic standards. These considerations have caused scholars to look for better alternatives to state-funded schooling. While few argue for the private donor-funded schools that preceded the state system, many in the West back the public-funded voucher system that is child-centric. The funding follows the child to the school of his (the parents’) choice.

Other issues in education are institutional in nature. State-provided schooling implies an institutional arrangement for translating voter preferences regarding education into educational output. At minimum, there is an agency charged with responsibility of the operation of schools. Issues such as selection methods and terms of office for the bureaucracy are relevant to the responsiveness of the agency to taxpayers’ preferences. Selection of teachers and the degree to which teachers influence educational policy also interest scholars of public choice. Today, education continues as a major public policy item not only in the industrialized world, but increasingly in the developing world as well. Scholars debate whether the level of economic development results from high education levels or whether education contributes to economic development. Many view education as the key to future development. Universal education has turned out to be the prime mover of socio-economic progress. Public choice has much to offer in understanding the relationship between the state and education.