Government Intervention

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Government Intervention and Quality of
Universities   Elise S. Brezis
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• Introduction
• In most countries of the Western world, there is
  these last years a will for reforming higher
  education institutions
• France, Germany, Italy, UK
• South Korea
• Lisbon strategy and Bologna Process

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• Knowledge and innovation are the engines of
  sustainable growth in Europe today, and
  universities are crucial for achieving the goals
  set out by the European Council. However, there
  are important weaknesses in the performance of
  European higher education institutions compared
  to those of our main competitors, notably the
  USA. Although the average quality of European
  universities is rather good, they are not in a
  position to deliver their full potential to boost
  economic growth, social cohesion and more and
  better jobs. The Commission invites national
  decision makers to set out measures that would
  enable universities to play a full role in the
  Lisbon strategy.Ján Figel, European
  Commissioner for Education, Training, Culture and
  Multilingualism. .

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• The reason for this will for reforms is the
  change of the purpose of universities and
  massification.
• I. Historical Background on purpose of
  universities
• II, Typology of universities
• III. Research Methodology

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• I.Historical Background
• From the Middle Age on, universities were part of
  the religious establishment, and their main role
  was to teach liberal arts, philosophy, and
  theology, though some of them became famous for
  specific subjects, such as law in Bologna and
  medicine in Montpellier.
• Most university students, whose numbers were in
  any case few, were preparing for a career in the
  Church, even after the Reformation.
• Homogeneity of quality of education (all in
  Latin).
• During these centuries, the impact of higher
  education on the economy was inexistent. Until
  19th century, the effects of university education
  on innovation are small.

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• Dramatic changes took place in the second part of
  20th century
• First, the role of universities has changed and
  they became of utmost importance for economic
  growth.
• Second, the quality of education became
  heterogeneous. Indeed, the number of universities
  and colleges in the West rose, and the number of
  students increased even more.
• Concurrently with this democratization of higher
  education, universities became heterogeneous not
  only in their specialization, but also in their
  quality.
• Elites universities vs. the rest

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• II. Typology of universities
• Massification and democratization of higher
  education led to a new typology of universities
• Universities are ranked by their quality.
• Why does it matter?
• 1. Signaling
• 2. Recruitment of elites.
• While there is a debate if the quality of
  university affects income.
• There is no doubt that it affects the selection
  of elites

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• The selection of elites on the basis of success
  at exams was the fundamental change in the
  recruitment of elites in the second half of the
  20th century.
• Before this period, education is not important
  for the selection process.
• After World War II, meritocracy (selecting the
  best by performance in exams) made inroads in
  Western countries.
• There is democratization of higher education, but
  in most countries, heterogeneity in the level of
  colleges the elites colleges and the rest.
• In consequence, the elite comes from elite
  universities.

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• In France, 50 the business elite comes from
  elites universities (ENA and grandes ecoles)
• Moreover, 8 of the population supplies 63 of
  the ENA students (or the next generation of
  rulers).
• Democratization of higher education and
  massification do not enhance social mobility.

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• The third change in 20th century
• With the emergence of this heterogeneity in the
  quality of universities, there is also an
  emergence of a new type of university the
  private universities.
• While during the 19th and first half of 20th
  century, there are mostly public universities,
  today, the emergence of private universities
  leads to a distinction between private
  universities, with no government intervention,
  and public ones, with government intervention in
  the decision making.

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• The purpose of this research is to analyze the
  correlation between these two typologies quality
  and government intervention
• While in the past, public universities were
  flourishing (the best universities were known to
  be the German ones like Heidelberg and Berlin),
  today the best universities are private.
• The US private universities are the highest in
  the ranking of universities, and it seems that
  the number of private universities between the
  elite universities increases over time.

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• III. Research Methodology
• The purpose of this paper is to examine the
  relationship between quality and government
  intervention. This research will be divided in
  three parts.
• The first part of the research analyzes
  government intervention in higher education
• The second part examines the quality of
  education.
• The third part will be devoted to analyze the
  interaction between these two elements
  government intervention and quality of
  universities.

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• A. Intervention in higher education
• (1) budget, budget allocation and tuition fees
• (2) Salaries and promotion of staff
• (3) Admission policy.
• In some countries the state takes decisions on
  these three categories. In others, only some of
  these categories are in the hands of the state.
• I will develop indices of state intervention.

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• For each indicator, the highest scoring
  institution is assigned a score of 100, and other
  institutions are calculated as a percentage of
  the top score.
• Scores for each indicator are weighted to arrive
  at a final overall score for an institution. The
  highest scoring institution is assigned a score
  of 100, and other institutions are calculated as
  a percentage of the top score.

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• (2) Salaries and promotion of staff
• Should government have a say on promotion policy,
  and should universities been given the autonomy
  on salaries?
• Is there a trade-off between level of wages and
  rapidity of promotion (Ehrenberg et al., 1998)?
• What are the consequences of having an
  idiosyncratic system on the quality of
  universities at a time of globalization of
  education?
• I will build an index on government intervention
  in the field of salaries and promotion
  (Ehrenberg, 2002 and King, 2001).

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• B. The quality of education
• 1. Definition of quality is related to the goal
  of education.
• Different Goals of universities
• Educated manpower Human capital
• Broad education
• Research formation of next generation
• Signaling/screening.

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• 2. Quantification and Indices
• Publications, citations, awards, Nobel Prize,
  patents. (see Liu, Coupe)
• Salaries of alumni.
• SAT scores
• Expenditures per student, student/faculty ratio,
  libraries..

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• C. State intervention and quality of Education
• The first part of this research is devoted to
  develop some indices of state intervention. Some
  of the indices will be focusing only on one of
  the categories presented above. There will be
  also general indices taking into account the
  three categories with different weights.
• The second part of the research is devoted to
  examine indices of the quality of education.
• This third part will examine their correlation.
  We will also check the correlation between
  quality of higher education and economic growth.
  

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• IV. Previous Research on this correlation
• Psacharopoulos, 2003
• Correlation of public expenditure/student vs.
  publication/population,
• Correlation of private share of education vs.
  quality (Nb. universities in top 100
  universities).

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• Policy Implications
• Should we privatize universities?
• Which of the three elements determining
  government intervention is the most important for
  improving the quality of universities?