The Role of Crossborder Education in the Debate on Education as a Public Good and

Private Commodity

Jane Knight

Comparative, International, Development Education Centre

Ontario Institute for Studies in Education, University of Toronto, Canada

Realities of Globalization

• Two views of education: reactor to globalization; actor of change

• Demand for higher and adult education--especially professional--increasing in most countries

• Information and communication technologies providing alternate and virtual means of delivery

• New types of providers: international companies, for-profit institutions, corporate universities, IT and media companies

So What?

• While increase in demand and exchange have been long term features,

• Only in last 15 years has education been a commodity or service for cross border delivery by both public and private sectors

• As such only subject to international trade rules until recently and described as commercial activity--WTO 1999

Realities of Cross Border Education and Trade Agreements

• GATS exists--agreement of WTO, supported by 148 countries.

• Education one of 12 sectors of GATS--here to stay

• To date: 47 countries committed to open domestic education system to foreign market access; 38 for higher education

• Knight argues: important implications flow from this and policy makers need to be aware of them

A Good or Commodity?

• Trade talk renders education a service and not a commodity

• Education sector often resents language shifts that move initiative and regulation away from education policy centers and into trade centers

• GATS a wake up call: It has forced education to carefully consider (a) significant growth in crossborder education that is happening irrespective of trade agreements and (b) reality and impact of multilateral trade rules on both domestic and crossborder higher education and commercial trade in education services

Growth and Shift to Commercial Crossborder Education

• Crossborder education=movement of education (students, researchers, professors, learning materials, programs, providers, knowledge, etc.) across national/regional or geographic borders

• Demand will increase from 1.8 million international students in 2000 to 7.2 million in 2025

• 70% of demand will come from Asia Pacific

• Exponential growth predicted for programs and institutions/providers

Two Trends

• Shift from student mobility to program and provider mobility--numbers of students seeking education in foreign countries still increasing, but more emphasis placed on delivering foreign academic courses and programs to students in home countries

• Substantial changes in orientation from development cooperation to competitive commerce--from aid to trade. (E.g. World Bank aid to China from 1987-1999--over $900 million

Category Forms and Conditions of Mobility

Development Educational Commercial Cooperation Linkages Tra de

People Students Professors/scholars Researchers/ Experts/consultants

Semester/year abroad Full degrees

Field/research work Internships Sabbaticals Consulting

Programs Course, program sub-degree, degree, post graduate

Twinning Franchised

Articulated/ Validated Joint/Double Award

Online/Distance

Providers Institutions Organizations Companies

Branch Campus Virtual University

Merger/Acquisit ion Independent Institutions

Projects

Academic projects Services

Research Curriculum

Capacity Building Educational services

Global Higher Education Index (GEI)

• Companies that offer education programs and services publicly traded on a stock exchange

• 49 Companies in five groups: Brick and Mortar

E-learning

IT training

Publishers

Software and consultancy firms

Traditional and New Providers

• Blending of tradition public and private HEI’s

• New providers include:

Publicly traded companies (Apollo-USA, Informatics-Singapore, Aptec-India)

Corporate universities (Motorola and Toyota)

Networks of universities, professional associations and organizations

Types of Companies and Profitability

• Of 41 that are direct competitors with traditional institutions: 23 brick and mortar

13 e-learning

5 IT

• 20 of 23 brick and mortar are profitable

• 4 out of 5 IT Training are profitable

• Only 4 of 13 e-learning are profitable

• Companies cover every region of world, but greatest numbers of receiving countries in Asia

Implications of GATS and Crossborder Education for HE

• Four Trends: Commercialization (buying and selling

including commodification)

Privatization (private ownership and/or funding)

Marketization (market determines supply and demand

Liberalization (removal of trade barriers and promotion of education as a tradable service)

Role of Government

• Throughout world government regulates, funds, provides and monitors higher education

• Ambiguous status of GATS Article 1.3: agreement applies to all measures “affecting services except those ‘services supplied in the exercise of government authority’”. Situation complicated by variance in what constitutes government supply, and change in status as exporting public HE is reclassified as it crosses border

• GATS Article 6.4--Domestic regulations and a country’s ability to set qualification, quality standards and licenses.

• Vagueness of phrase ”not more burdensome than necessary” raises questions about possible confusions over quality assurance and accreditation

Financing of HE

• Universal trend of declining public sector support

• Creates possible double bind

Declining public support draws private funding--accelerated by liberalization

When private funding increases, often public sector response is to let support fall even more.

• Trade enters as countries without capacity or will turn increasingly to foreign investors, creating dependency nexus

Some Key Finance-Related Questions

• What are national policy objectives for HE and how can crossborder contribute?

• What is role of govt as funder, provider, regulator, monitor?

• How regulated or deregulated is sector?

• How is public support provided and apportioned? (Fees, vouchers, etc.)

• What is the profit, not-for-profit mix?

• For public HE what is the mix of government, student/household and private sources of income?

• What is country position in terms of granting access through trade?

• Is HE seen as public good/service or private good/service?

• If HE is private good/service can it be publicly delivered?

Student Access--Who Benefits

• Crossborder commercial providers mostly concerned with teaching

• Limited attention to research and service

• Tend to target niche markets capable of generating profits

• While it generates capacity, raises question of whether it will only be available to those who can afford it.

• Who benefits? Paradigm a huge shift in public HE rationale and “takes the discussion of education as a public good into a whole new sphere as it is no longer the society-individual-dilemma…It now includes the education provider as well”

Quality Assurance

• Significant new activity--over sixty countries in last decade

• Historically countries have not been concerned with imported education

• Sectors other than education (e.g. business, accounting, etc.) also pursuing quality standards (e.g. Baldridge Awards)

• High level of non-commercial cross border activity also drives quality questions.

• Commercialization of accreditation through:

Export and contracting of existing agencies (e.g. Regional and specialized accreditation in the US.

Invention of new international accrediting mechanisms

Quality control of HE accreditation itself an issue

• Accreditation an important part of branding for trade

Diversification and Diversity Issues

• Which courses are offered and why? Market selection can lead to significant bias toward high return courses (business, information technology, communication)

• What gets left behind and must the public/non-profit sector make up the difference?

• What happens to HE overall when research is left out of the equation?

• Two faces of commercialization and cultural diversity:

English language dominance

Conflict over “fusion” or “dilution” of culture.

Will commercial providers spend “extra” for relevant local content?

Human Capacity or Brain Gain Drain?/Trade Creep or Trade Choice?

• Trade offs as private sector provides capacity and crossborder exchanges increase. Who goes where for what and stays where for how long? Including migration out of HE to private sector.

• Trade creep=“the quietly pervasive introduction of trade concepts, language and policy into the education sector.” (Discursive shifts)

• Trade choice=the welcome investment of resources into HE as an export industry and its promotion.

• Mixed benefit packages for differentiated recipients

Traditional HE

• Trinity of teaching/learning, research and service guided evolution of universities and contributions to social, cultural, human, scientific, technological and economic advancement of nation

• And--total development of individuals

• To what extent can these attributes be disaggregated and rendered by different providers?