Higher Education & Economic Development: Comparing Kenya, Mauritius, South Africa

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Arthur Sanders
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1 Higher Education & Economic Development: Comparing Kenya, Mauritius, South Africa Pundy Pillay International Conference on HE & ED Mauritius, 3-5 September 2012

2 Outline The case for HE vis a vis Economic Development HERANA study findings on HE and ED Comparing Kenya, Mauritius, S Africa a) Schooling & HE b) The Economy c) Research, Innovation, KE Conclusions

3 The case for HE vis a vis ED Little disagreement that investments in human capital (education and health) are crucial for social and economic development However, HE long been neglected by policy makers in Africa and funders Rationale: social returns to HE lower than for primary and secondary More recent evidence: HE associated with higher private and social returns compared to primary

4 .contd. But Africa is lagging behind other developing regions in HE - e.g. low participation rates; low access to information and knowledge as evidenced by lower PC coverage, internet usage, scientific and technical journals published, royalties and licences received, and patent applications Neglect of HE has impacted on other dimensions of human development: quality of primary and secondary education (teachers); quality of basic health care (nurses, doctors, other medical personnel) For Africa to achieve and sustain high rates of growth, needs major transformation in the str. of production + a reduced technological gap these require a large pool of the labour force with tertiary education

5 Characteristics of HE in SSA Low participation rates - 5-6% on average Low levels of public investment in HE Poor internal efficiency Poor quality of outcomes Inequality of access and outcomes by gender, socioeconomic status & region Weak institutional differentiation Weak higher education labour market linkages (the socalled [weak] external efficiency of HE)

6 Characteristics of SSA Economies Economic Growth, high in many places but often not propoor; i.e. economic growth, not economic development Inequality High levels of poverty Low levels of human development Low levels of competitiveness (WEF: highest ranked SSA country is RSA at 45/133; SSA 20 out of bottom 40) WEF GCI: 23/38 stage 1 economies are African Low levels of innovation: Global Innovation Index Mauritius highest at 49; 10 of the bottom 20 are African

7 Pre-conditions for effective HE-ED relationship Quantitative and qualitative improvements in schooling Effective economic and education planning The role of the state: HE funding; R&D funding; stimulating private sector partnerships; ensuring HE has a role in development strategy; coordination between different agencies Partnerships and Consensus Building: a PACT Institutional Differentiation Effective HE-labour market relationships

8 Recognising the role of HE in Economic Development Growth vs. Development Employment and Unemployment Poverty Inequality (Income, Assets) Human Development (e.g. HDI)

9 Comparing Kenya, Mauritius, SA Why these three countries? Why not M vs. Botswana and Namibia small economies Kenya low-income country but important in the East African context SA largest economy in Africa with vast inequalities in education and economy All three in Herana sample

10 Schooling Participation: high in all three countries in primary; high in M and SA in secondary (90%), less so in K (60%) Quality: good in M, variable in SA and K Expenditure: high in K and SA as a % of GNI and of GDP per capita ; low in M

11 ...contd. Observed divergence in the incomes of African countries compared to Asia and L America due in part to the HE gap But poor economic performance in African economies could be due both to low quantity of HE accumulated and low quality of Prim and Sec Quality is linked to skills and skills explains growth much better than attainment

12 Higher Education Participation a) Mauritius: 45% (includes public and private, overseas students, universities + other) b) South Africa: 18% (public universities only) c) Kenya: 6% (public tertiary institutions)

13 ...contd. Public Expenditure a) SA: relatively high, 20% of education budget (20% of total budget) b) Mauritius low c) Kenya - Low

14 School life expectancy, primary to tertiary Mauritius 58/133 (Global Innovation Index) Kenya 103 Botswana 83 Namibia 91

15 HE: internal and external efficiency Measures of IE: repetition, drop-out, low graduation rates Measure of EE: absorption in the LM IE: M high; SA and Kenya low EE: M high; SA and Kenya - low

16 The Economy Status M and SA middle income; K low income GNI per capita ($): K 780; SA 6100; M 7740 (2010) PPP terms: K 1610; SA 10280; M Economic growth ( ): M 4%; K 4.3; SA 3.9 EG much lower than SSA average and growth stars such as Mozambique, Uganda, Angola

17 ...contd. Composition of GDP Kenya Mauritius SA Agriculture Industry Services Impt.: What are implications of the above for a) economic growth; and b) HE?

18 ...contd. Poverty: M low; Kenya: 20-45%; SA 5 23% depending on measures used Income inequality Gini coefficient a) Mauritius and Kenya moderate 0.4 b) SA highest in the world 0.7 Unemployment: M 8%; SA: 25%; K 40% HDI: M 77/187; SA 123; K 143

19 Research, Innovation, Knowledge Economy Global Innovation Index Mauritius 49/141; SA 54; Kenya 96 (Switzerland:1; Sweden 2; Singapore 3) Inputs Human Capital and Research (education, tertiary education, R&D): Mauritius 70; Kenya 72; SA 103

20 ...contd. GII Knowledge and technology outputs South Africa 61; Mauritius 78; Kenya 102 Employment in knowledge intensive services: a) South Africa 55 (24%) b) Mauritius 85 (16%) c) Botswana 81 (17%) Singapore (1) 51%; Netherlands (2) 47%

21 Conclusions Quantitative and qualitative improvements in schooling Effective economic and education planning The role of the state: HE funding; R&D funding; stimulating private sector partnerships; ensuring HE has a role in development strategy; coordination between different agencies Institutional Differentiation Effective HE-labour market relationships

22 Following the same Development Path or Leapfrogging? Developing countries do not have to follow traditional development paths Compare China vs. India Features of Mauritian economy have been: a) flexibility in the face of changing economic circumstances; and b) growth with equity

23 HE-ED challenges - Mauritius Higher levels of Economic Growth Higher levels of employment in knowledgeintensive services More public expenditure in higher education Improving HE-labour market linkages

24 HE-ED challenges Kenya & SA Socio-economic challenges poverty; unemployment; inadequate growth (SA inequality) Development path must be oriented towards both manufacturing and services Manufacturing: needs better and more outputs from VET system Services (esp. Knowledge): needs expansion of university outputs in both quantitative and qualitative terms Improvement in schooling quality

25 Kenya and SA (contd.) Education and economic planning Growth that is pro-poor, inclusive i.e. employment enhancing State needs to be more effective in directing development

Evan Hillebrand University of Kentucky

Evan Hillebrand University of Kentucky Rome, 2009 1 Percent of world s people living below $1 a day absolute poverty line 120.0% 100.0% 80.0% 60.0% 40.0% Bourguignon/Morrisson Chen/Ravallion Hillebrand