By Elliott R. Morss, Ph.D.
NEW YORK (
) -- The latest global results on reading, math and science achievements have just been reported by the
. These educational achievements of young people are probably a pretty good leading indicator on how countries will fare in the 21st Century. In this article, these results are coupled with information on income inequality to draw interesting conclusions.
The test scores for selected countries are presented in Table 1. They are ranked by the final column -- the average score on all three subjects.
What do these findings tell us? Note the dominance of Asian countries at the top of the table. And note where most European countries and the U.S. end up. Europe and the U.S. had a tremendous head start on other nations. But now, does anyone in Europe or the U.S. really care about how well-educated their children are? These finding suggest the answer is no.
Does the amount spent per student in primary and secondary school influence scores? It does. For the 25 countries that the OECD has both scores and per student expenditure data, expenditures are positively correlated with scores and explain 47% of the variance in scores.
Table 2 provides information on average scores and total primary and secondary school expenditures per student for selected countries.
Does the pattern seen in Table 2 look familiar? For anyone who has read
. The U.S. spends tremendous amounts on health and education with a small return.
Education and Income Inequality
I hypothesize that educational attainment and income inequality are related: in countries with high income inequality, test scores will be lower. What is the basis for this hypothesis? In all countries, most students attend public school. But in countries with high income inequality, rich families will send their kids to private schools: and as a result, they don't care about the quality of public schools and won't want to support them.
What is the evidence? The Gini Coefficient measures income inequality. A Gini with a zero value means everyone has the same income. As the Gini increases, income inequality grows. Using a sample of 56 countries and data from the OECD, the Gini coefficient explains 22% of the variation in average educational attainment: as the Gini (income inequality) grows, educational attainment falls.
Two final points on young Americans:
1) Nearly 25% of students fail the written exam to join the U.S. military;
2) 75% of those aged 17 to 24 don't qualify for the military because they are physically unfit (25% of American youths are obese), have a criminal record or didn't graduate from high school.
Elliott Morss is an economic consultant and an individual investor in developing countries. He has taught at the University of Michigan, Harvard University, Boston University, among other schools. Morss worked at the International Monetary Fund and helped establish Development Alternatives Inc. He has co-written six books and published more than four dozen articles in professional journals.