Questioning the neoclassical political economy of higher education participation: Evidence from Chile

• In Event: Regional comparisons in higher education

Abstract

General Description:
Tertiary education is considered a key sector for economic and social development. One of the main challenges involves ensuring access and participation to all segments of society. In order to achieve this goal many countries have implemented cost-sharing schemes, based on the notion that since higher education has large private returns, students will be willing to finance their own education if loans and credit are made available. Within this policy discussion, this paper studies the expectations and attitudes of secondary students towards higher education participation and returns, placing special emphasis on the differences across socio-economic groups.
To achieve this objective, an empirical research was carried out in Chile focusing on: students` attitudes towards school, expectations of significant others, attitudes towards higher education participation and main perceived constraints, risk perception related to educational investment and debt, inter-temporal discount rates, access to information and searching activities, and ex ante expected return rates to higher education.
This study shows that students` participation decisions are influenced by several economic and social dimensions, beyond financial returns. Additionally, the empirical research undertaken in Chile finds that attitudes towards participation and expectations regarding (ex ante) rates of return to higher education systematically differ between social segments of society. Therefore, traditional student loan systems are inadequate to encourage higher education participation among students from poorer families, hindering their future and the promise of higher levels of social mobility.
Methodology:
For the purpose of this study, two private and four public-funded schools from Santiago, the capital city of Chile, were selected. The sample was stratified by school socio-economic background, according to the classification published by the Ministry of Education of Chile.
These six schools were visited in order to apply specially designed questionnaires to 489 secondary students (twelfth graders). All classes within the same level in a school were surveyed to avoid any possible bias in terms of quality of students.

Main results:
The main results show the existence of significant social class differences in relation to the perceived ex ante rates of return (RoR) to higher education. Students from upper social economic status (SES) estimate a RoR of 20.2%. Students from medium and low SES provide estimates of 14.7% and 9.8%, respectively. On average poorer students perceive a rate of return that is less than half the one expected by high SES students.

Conclusions:
This study provides substantial theoretical discussion and empirical evidence to question neoliberal policies put forward by governments to foster higher education participation, specifically, those related to cost sharing schemes. These schemes are based on standard general neoclassical assumptions regarding students` behavior, ignoring the existing differences across different social contexts. As a result the increasing privatization of higher education should be a matter of concern for international comparative education researchers and also for policy makers in countries such as Chile and the United Kingdom, where these policies have gained solid ground.

Author

• Francisco Gonzalez, PhD Student, Centre of Development Studies, University of Cambridge