1. Market in Education Fan-sing Hung The Chinese University of Hong Kong

2. plan Government failure: why and what’ll happen? Public ed. failure: why and what’ll happen? Market in ed.: mk’t forces, mk’t consequences finance & operation of ed.: gov’t versus market School Voucher Scheme Direct Subsidy Scheme

3. Gov’t failure: why? Gov’t monopoly –lack of competition –take for granted Producer-oriented –no risk-taking, no mistake –red-tape –production according to gov’t officials

4. Gov’t failure: why? Non-market decision making –politician interest: election –gov’t bureaucrat & employee interests: expansion, promotion, salary increase, provider captured

5. Gov’t failure: what will happen? high price low efficiency lack of choice, lack of due attention to consumer preference slow in change adjustment market distortion rent-seeking, corruption, abuse of gov’t power

6. Public ed.failure: why? Gov’t officials not educationally professional Public ed. tends to be –mass production, standardized –top-down, bureaucractic –monopolized by one entity (i.e. gov’t) –risk averting, lack of innovation

7. Public ed.failure: what’ll happen? Educational efficiency drops Educational choice narrows Educational innovation averted Lack of educational initiative Lack of educational incentive Bureaucrat mindset driven

8. Market in ed.: market forces Price determined by free interaction between supply & demand Consumer preference – choice of school, teaching & learning, curriculum, teachers Provider motives – quality improvement

9. Market in ed.: market forces Information accessible and available – quality of education Free mobility of resources – school, curriculum, teaching & learning, teachers, materials

10. Market consequences Product differentiation (curriculum, teaching & learning, teacher, school, …. Price competition Reward/penalty by the market Innovation stimulated

11. Finance & Operation of Education Not necessarily all by the gov’t Finance can be made by the gov’t if deemed necessary BUT operation can be in the hands of private individuals/organizations, for or not for profits making

12. School Voucher System Eliminate/reduce government bureaucracy Increase competition among schools Increase parents’ choice of education Efficiency in education thus increased in the end of the day

13. School Voucher System Universal versus Limited Voucher (scale, target, $ amount, mandatory vs voluntary, …) However, 3 domains to consider –Finance –Regulation –Information

14. Direct Subsidy Scheme in HK Autonomy in student admission, teacher and personnel establishment, curriculum, instruction, fees charged Gov’t subsidy on per head basis Much higher subsidy from the gov’t than aided school Financially enhanced than aided schools

15. DSS Development

16. Old and New DSS Compared Year Fee DSS Max Effective Total Income 1988 <= 2/3X X 1 2 / 3 X 2/3X-1 5/12X X-1/4X 1 2/3X >1 5/12 X ¼ X >= 1 2/3 X 2001<=2 1 / 3 X X3 1 / 3 X Gain (or Loss) (2001)-(1988) = + 1 2 / 3 X = + 1.67 times of X

17. 『直資』 : 概念的討論  教育的資助 vs 教育的經營  教育的市 ( 競爭 ) 機制  教育多元化  教育選擇  教育的成本效益分析

18. 『直資』 : 政策的檢視  『直資』的理念是甚麼？  『直資』學校是私校嗎？  『直資』學校 vs 資助學校 : 有何不同？  『直資』可帶來市場競爭嗎？  『直資』可帶來教育多元化嗎？  『直資』可帶來教育選擇嗎？

19. 『直資』 : 具體措施的檢視 “Give” and “Take”  資助轉『直資』 vs 全新開辦『直資』 : 應否有所不同 ?  資產流失  尋租 (Rent Seeking) vs 生產力改善 (Productivity Augmenting)  教育資訊 : 『不對稱』資訊

20. 『直資』 : 具體措施的檢視 ( 續 )  助學金 ( 對低收入同學 ) - 學費及一切雜費 - 『直資』學校提供 vs 政府全面『包底』  收生：學校收生自主 vs 隨機收錄  教師 : 薪酬及穩定性 ( 合理？ )  辦學權：永久 ( 必然 ) vs 定期檢討

21. 『直資』 : 具體措施的檢視 ( 續 )  財務管理 - 盈餘 : 儲備 vs 分紅 ( 辦學團體？管理委員會？ 校長？老師？ ) - 虧損 : 辦學團體 vs 政府 - 資本性開支 : 辦學團體 vs 政府  市場佔有率 : 多少百分比 ? 市場均 ?