How much does it cost choosing in Chilean higher education? Diversification of tuition fees during the last decade in Chile Nelson Paulus Paula Mena Esteban Geoffroy

Abstract “How much does it cost choosing in Chilean higher education?” A theoretical presupposition underlying liberalisation of Chilean Higher Education was that market would widen the access and increase the freedom of choice. It is therefore worth asking how differentiated is, in relation to its fees, the offer of undergraduate courses? By using statistical information gathered by the Higher Council of Education, this paper describes the evolution of several indicators associated to costs in order to identify how, as time goes by, the range of alternatives either narrows down or widens. This will be followed by an analysis of the current offer of fees and their relationship with other relevant variables.

Introduction Development Liberalization process Neoliberal economic system After introducing substantive reforms in the constitutional order, labour codes, social security, health system, capital markets and public education, towards the early 1980s they turned their attention to higher education The whole of the university system had raised their fees in an average 47% between 1995 and 2002 and noting also that nothing pointed towards a change in this incremental tendency because of people’s expectation to get university schooling.

We can see that towards the end of the 1990s has a 44,9% of private participation in funding the general costs of education. In the context of higher education, this same indicator goes as high as 77,2%, a figure that is mostly made out of the contribution of Chilean households. In 2005, the contribution of this same indicator went higher than 95% of the private contribution in higher education (OECD, 2007).

Graphic 0: Relative proportion of expenditure by private entities other than households on TEIs, 1995 and 2004 Countries are ranked in descending order of the relative proportion of expenditure by private entities other than households on TEIs in 2004. Note: See note on Figure 4.5 for a definition of expenditure by “private entities”. For Denmark data include part of post-secondary non-tertiary education. For the Slovak Republic data do not include Tertiary-type B education. For „2004‟ data, the reference year for Chile is 2005. Source: OECD (2004; 2007a). OECD (2004), Education at a Glance: OECD Indicators 2004, OECD, Paris. OECD (2007a), Education at a Glance: OECD Indicators 2007, OECD, Paris.

Graphic Nº3. Evolution of percentage participation of non-technical undergraduate courses in ranges of thousands of US$

Administration and Commerce. Table Nº1: Percentage distribution by area of the programme in offer (2007)   Entre 0 US$ y 999 US$ Entre 1000 US$ y 1999 US$ Entre 2000 US$ y 2999 US$ Entre 3000 US$ y 3999 US$ Entre 4000 US$ y 4999 US$ Entre 5000 US$ y 5999 US$ Entre 6000 US$ y 6999 US$ Entre 7000 US$ y 7999 US$ Entre 8000 US$ y 8999 US$ Entre 9000 US$ y 9999 US$ Administration and Commerce. 0,6% 28,5% 38,9% 22,3% 6,2% 2,1% 1,1% 0,2% 0,0% Agro-industry 11,1% 13,5% 35,7% 27,8% 0,8% Arts and Architecture 16,0% 19,1% 27,5% 20,6% 8,4% 3,8% 4,6% Sciences 16,3% 44,2% 34,6% 2,9% 1,9% Social Sciences 16,9% 30,7% 30,2% 11,2% 6,0% 3,9% 1,0% Law 15,4% 24,5% 32,9% 18,9% 4,9% 3,5% Education 24,4% 51,3% 20,5% 3,2% 0,3% Humanities 36,1% 19,3% 9,6% 7,2% 1,2% Health 34,8% 26,5% 13,1% 4,8% Technology 17,3% 39,0% 23,7% 14,2% 4,4% 1,3% 0,1%

Graphic 7. Universities percentage participation of number of programmes by range of prices

Graphic 8. Professional Institutions percentage participation of number of programmes by range of prices

Table Nº2. Evolution of annual average income by quintile in US$   1996 1998 2000 2003 2006 V 26276 30846 33832 34991 38462 IV 8831 10330 10795 11567 13949 III 5387 6283 7050 7385 8905 II 3672 4294 4790 5108 6171 I 1772 1983 2302 2409 2932 Total USD Average for 2007 Annual 9188 10747 11786 12281 14083

Average fee of the system Table 3. Evolution of the value of average fees in the system in relation to the annual average income, by quintile Average fee of the system 1996 1998 2000 2003 2006 V 5,7% 5,8% 6,1% 7,2% 7,4% IV 16,9% 17,3% 19,1% 21,7% 20,4% III 27,6% 28,4% 29,2% 34,0% 32,0% II 40,6% 41,6% 43,1% 49,2% 46,2% I 84,0% 90,1% 89,6% 104,3% 97,3% Average of incomes General 16,2% 16,6% 17,5% 20,5% 20,3%

Professional Qualification with an academic degree Table Nº4: Percentage participation of average fee of different programmes in relation to annual average income, by quintile. Average income by household for 2006, by quintile Professional Qualification with an academic degree Medicin V 8,5% 16,3% IV 23,5% 45,0% III 36,7% 70,4% II 53,0% 101,6% I 111,6% 213,9% General Average 23,2% 44,5%