1. Higher Education and the World Bank
Richard Hopper
Education Specialist
The World Bank
15 April 2007

2. Enrollment trends

3. Enrollment rates by income level (1980-2001)

4. Enrollment rates by region (1970-2001)

5. Equity

6. Equity remains a problem
Mexico (2005)
Only 1% of year olds from poorest quintile attend tertiary education
While 32% from richest quintile attend
USA (2005)
Only 8.3% of students from the poorest income quintile are likely to access top-ranked universities
While 50% of richest quintile are likely to attend
France (2005)
Only 6% of students from the lowest quintile are likely to attend a Grande Ecole
While 15% of the middle quintile are likely to attend

7. Tertiary Enrollment by Quintile

8. Quality

9. Quality and relevance of studies increasingly important
Knowledge-driven economic growth…
Requires higher labor productivity and an increased demand for skilled workers
Changes the education and training needs of the labor force as skills become obsolete and require updating
Aging populations and the need for updating skills means a more diverse set of clients (students) in tertiary education
lifelong learning

10. Changes in demand for job skills 1960-1998
Effects of mass introduction of computers in the workplace on demand for skills ==) new division of labor within firms
Figure displays trend for each of five types of tasks.
Expert thinking: solving problems for which there are no rule-based solutions, e.g. research, forming and testing hypotheses, medical diagnosis and diagnostic in general (resolving discrepancies).
Complex communication: interacting with humans to acquire information, to explain it, or to persuade others of its implications for action, e.g. persuading, selling, legal writing, managing others.
Routine cognitive tasks: mental tasks that are well described by logical rules, e.g. maintaining expense reports, record keeping, repetitive customer service, bank teller.
Routine manual tasks: physical tasks that can be well described using rules, e.g. counting and packaging pills, repetitive assembly.
Non-routine manual tasks: physical tasks that cannot be well described as following a set of “If-Then-Do rules” – instead, they require optical recognition and fine muscle control, e.g. janitorial services, truck driving.
Each trend reflects changes in the numbers of people employed in occupations emphasizing that task.
Importance of each task in US economy is set to 0 in 1969, value in each subsequent year represents percentile change in importance of each type of task in economy.
Rules-based tasks (routine tasks) where computers can substitute for humans, have decline.
==) need for new programs and new curricula
Source: Autor, Levy, and Murnane (2003) “The Skill Content of Recent Technological Change: An Empirical Exploration,” Quarterly Journal of Economics.

11. Divergence in returns to schooling by education level in Latin America from Holm-Nielsen et al. (2001)

12. Finance

13. Tertiary education spending relative to GDP, OECD 1998

14. Poor internal efficiency remains a waste of public resources
Proportion of enrolled students who never finish their studies:
75% in Argentina
60% in Morocco
30% in Australia
Proportion of students who graduate on time:
13% in Italy

15. Proportion of private enrollment 2003

16. Longstanding challenges
How can governments develop a financially sustainable tertiary education system in the face of expanding demand?
How can governments maintain or improve the quality of tertiary education under such financial pressures?

17. Importance of Science and Technology

18. Skills and Capabilities
R&D
Science
Development
and Creation
Design &
Engineering
Technician & Craft
Skills & Capabilities
Science
Use, Operation
and Maintenance
Basic Operators
Skills and Capabilities
Higher levels require higher-order capacity of human resources

19. S&T Lessons From World Bank Operations
Developing human capital is an essential pre-requisite for S&T capacity building
Sustained long-term engagement is key
Specific investment loans have better results than budget support
hands-on rather than arm’s-length
Comparative advantage is created not given
Salmon, grapes in Chile
Cut flowers in Tanzania
Electronics in Korea and Taiwan
Interventions work best when grounded in each country's own S&T and industrial strategy

20. S&T Challenges Long term commitment
Ability to produce new knowledge (R&D) is important, yet absorptive capacity of enterprises and labor force must be developed – spillovers are not automatic
Few centers of excellence or competition among many institutions?
Tension between expanding the supply of skilled workers and industry demand for skilled workers
chicken and egg problem
brain drain vs. skill shortage
Vietnam
supply with limited demand
Thailand or Malaysia
demand with limited supply
Long term commitment
S&T requires long-term political engagement
>10 years for capacity to affect development

21. Country analysis: Korea

22. Knowledge economy

23. Technological Revolution
Economic Revolution
Technological Revolution
Knowledge Economy
New Face of Higher Education
Fast
Connected
Evolving
Quality-driven
Agile
Slow
Isolated
Static
Seniority-driven
Rigid
New
Opportunities

24. Knowledge for Development
Economic Structure and Incentives
Tariff and non-tariff barriers
Property rights
Regulation 1
Universal basic education enrollment and completion
Secondary enrollment, completion and quality
Tertiary enrollment, quality, system flexibility
Lifelong learning to update skills; multiple entry points
Education 2
Information Infrastructure
Telephone capacity/capita
Computers /capita
Internet hosts /capita 3
Researchers in R&D
Manufacturing trade as % of GDP
Scientific articles/million pop.
Innovation
System 4

25. Crisis prevention vs. coherent policy
Many countries tend to be reactive
Lack of national policy debate and framework for higher education lead countries to react to problems
The World Bank helps governments avoid reactive practices by developing and implementing higher education strategies
More flexible systems and institutions
Focus on governance, finance (efficiency), quality (innovation), and equity

26. State role in strategy development
Describing the status quo
Identifying issues, diagnosing problems
Presenting potential options
Engaging stakeholders in dialogue
Developing a shared vision
Investing in elements that improve…
Institutional agility
Education quality
Internal and external efficiency
Equity
Initiating innovative resource distribution mechanisms that focus on organizational behaviors
Engaging stakeholders in throughout the process

27. Range of World Bank interventions and investments in higher education

28. Governance Move from state control to state oversight
Encourage private sector development
Ease restrictions on private providers
Develop reasonable oversight for private sector so as not to stifle innovation or growth
Maintain equal standards for public and private provision
Build institutional management capacities at public institutions in support of greater autonomy
Governing board development and training
Accountability systems (stakeholder / civil society membership)
Strategic planning exercises
Leadership training
Financial management / procurement capacity
Management information systems
Curriculum reviews and revisions
Human resources management
Modular academic programs (LMD, credit systems, lifelong learning)
Admissions reform (entrance exams, etc.)
Civil service adjustment

29. Finance Investment budget mechanisms Recurrent budget mechanisms
Formula funding
Bloc grants
Competitive funding
Linked to quality improvements or government priorities
Research funding
Recurrent budget mechanisms
Performance-based financing
Demand-side financing
Student loans
Vouchers, scholarships
Cost recovery mechanisms

30. Quality Centers of excellence
Quality assurance systems (accreditation)
Establish quality assurance systems
Reform existing quality assurance systems
Develop institution-level quality practices
Develop professional licensing capacity
Link financing to quality assurance determinations
Develop benchmarking capacity
Develop system and institution performance indicators
Develop measurements for student learning outcomes
Encourage mutual recognition systems
Faculty training and upgrading of skills to improve pedagogy, teaching methods, student learning
Develop competency frameworks

31. Efficiency and equity Expansion of private sector
With parallel finance innovations
Efficiency gains in public sector
Double sessions
Repetition reduction
Non-university tertiary education
Develop pathways to link technical vocational education with university education
Distance education, non-traditional learning
University partnerships and sandwich programs
Labor market observatories
Graduate tracer surveys
Support public-private partnerships between universities and industry

32. Infrastructure Post-conflict reconstruction
Leverage as opportunity to rethink pre-existing system
Construction of new institutions
Installation or upgrading of information technology

33. Science and technology
Millennium Science Initiatives
Universities and research institutes
Science and technology projects
Universities, research institutes, industry
Agricultural technology investments
Private sector development investments

34. World Bank Lending for Tertiary Education by Region, Fiscal 1990 – 2006

35. Ten Largest Borrowers for Tertiary Education, Fiscal 1990 – 2006

36. World Bank Lending for Tertiary Education by Region, Fiscal 2001 – 2006

37. Ten Largest Borrowers for Tertiary Education, Fiscal 2001 – 2006