The effects of adjustment on education: A review of asian experience

Summary and conclusions

It is difficult to isolate the effects of adjustment policies on education. Even elaborate country studies could not properly assess the definitive effects of adjustment. As Stanley Fischer (1991, p. 526) observed, ‘the evaluation of adjustment lending is not only extremely difficult, but also essential. None of the methods of evaluation are entirely satisfactory’. Here, an attempt has been made to examine the association between adjustment and the development of education. The effects identified can, at best, be treated asprobable effects. While no causal relationship could be found, intense adjustment is generally associated with declines in a variety of indicators on educational development in Asian countries, similar to patterns observed in many other regions. At the same time, it should also be noted that, on the average, while the education sector in Asian countries suffered during adjustment, it also seems to have been relatively well protected from the brutal effects affecting developing countries in other regions experiencing adjustment.

The effects of adjustment, however, have not been uniform on all countries of the Asian region, and several economies suffered severely. It has been found that, during the adjustment processes, the proportion of GNP or of total government expenditure allocated to education declined in a majority of the adjusting (including intensely adjusting) countries, even though the corresponding figures also point to a decline in some of the non-adjusting countries. In a large number of the adjusting countries, the relative share of capital expenditure on education declined and that of current expenditure increased.

The allocation of resources to primary education seems to have been protected in most countries, except in Pakistan and Bangladesh. This is also true of non-adjusting countries, such an India and Malaysia, where the relative share of primary education actually increased. More importantly, the real expenditure per student in primary education increased significantly in all countries, with the exception of the Philippines and Nepal, during the first half of the 1980s (the only period for which these data are available). Expenditure per student in primary education as a ratio of GNP per capita also increased in all countries, while the corresponding proportion relating to higher education declined in all countris, except in India. All this indicates that concerted efforts have been made by the adjusting as well as the non-adjusting countries in Asia to protect primary education; a remarkable achievement when compared to other developing countries of the world (see Berstecher & Carr-Hill, 1990). Adjusting countries could have protected primary education from budget cuts through social safety-net programmes introduced as a part of adjustment policies in several countries, as in India during the 199s.

However, enrolment ratios in primary education declined in two of the intensely adjusting countries, namely in Pakistan and Thailand. Although the gross enrolment ratio in Pakistan is deplorably low (44% in 1990), Bangladesh registered remarkable progress with increases not only in gross but also in net enrolment ratios, which went up from 54% in 1985 to 69% by the end of the 1980s. The number of pupils per teacher in Bangladesh, however, has increased to one of the highest levels in the region, suggesting that quality was traded-off for quantitative expansion.

Internal efficiency also increased in all countries of the region. While gender discrimination has been found to have increased as far as the stock of the educated people is concerned, gender discrimination in enrolments has been coming down in all the countries.

Lastly, the relative share of the private sector, although limited at present, seems to be increasing. Fees appear to have been introduced even in primary schools in some countries and have had a negative effect on the demand for education and on total enrolments. Increases in the degree of privatization and the introduction/increase of fees in education have been dominant, thought not necessarily explicit, components of adjustment polcies.

While, on the whole, the effects of adjustment on education seemed to be mixed, and no striking difference could be observed between adjusting/intensely adjusting and non-adjusting countries in short-term educational development trends in Asia, the tentative evidence from a few countries does suggest a strong association between adjusting policies and a deterioration in educational situations. Such a strong association is clearly discernible with respect to several important indicators of educational development, although not with respect to all. It would be useful to look into this association more closely in one or two selected countries to clearly understand the effects of adjustment on education. Though the problems that will be found and the associations observd in a particular country may be unique, and may not be relevant for others, such country studies would be valuable to draw lessons, not only for the countries concerned, but also for others.

The experience of both the Asian (and even other) countries, as well as of international agencies with structural adjustment programmes is short (about ten of fifteen years). As ‘adjustment’ is a long on-going process, analysis of its effects over a short period of time would be premature and problematic, as quick results cannot be expected. More importantly, it is probable that the ‘positive impacts are realized with a considerable time lag, while its adverse effects are immediate and highly visible ... [but these programmes] may not be sustainable, economically and politically, if their immediate [negative] impacts are not mitigated’ (Yanagihara, 1989, p. 319-21). Otherwise, programmes may not be taken to their logical conclusion. Further, gradual adjustment policies have been generally found to be successful in the East Asian economies, rather than a ‘big bang’ approach involving shocks and sudden simultaneous shifts in all policies in an attempt to move forward quickly (Agrawal et al., 1992, p. 182). The latter approach can, in fact, be counter-productive.

As a result of the growing research in the area and the interest of international organizations, such as UNICEF, the adverse effects of structural adjustment on social sectors are being monitored by both the donor agencies, such as the World Bank/IMF, and the countries concerned. Accordingly, structural adjustment programmes are being supplemented in a number of countries with sectoral adjustment and ‘social safety nets’ and other contingency programmes, so that the poor are not severely affected. Primary education is one of the important components of such programmes. In general, it is necessary that structural adjustment programmes and education sector adjustment programmes be integrated, and that the adjustment programmes include agreements on increasing public expenditure on education. Structural adjustment policies without such education sector adjustment programmes and social safety-net programmes that guarantee increases in public expenditure on education are likely to cause serious adverse effects. Hence, ‘it is important that structural adjustment agreements recognize the need for countries to commit new resources and reallocate existing resources toward investment sectors, such as basic education, which affect both social welfae and medium- and long-term economic growth’ (Organisation for Economic Co-operation and Development, 1992, p. 63).

Further, it is necessary for the success of the adjustment programmes that the primary responsibility for the concetion of structural adjustment programmes lie with the national authorities that will implement and sustain the programmes; imposed programmes may not work (Malan, 1991, p. 539). The Republic of Korea is a good example of how structural adjustment programmes could succeed because it was undertaken on the basis of its own conviction. This will also help in reducing the political costs of adjustment programmes. With the level of expertise and competence available in the Asian countries one should expect that shifting the primary responsibility to the national governments is perfectly possible, compared to those regions that do not have indigenous expertise.

Of late, some flexibility in and softening of the World Bank/IMF’s hard-line views of precisely what an ideal package of structural adjustment reforms should consist of are visible (Ranis, 1987, p. 97), though it may have to be further improved (Tilak, 1992). Lastly, it should be realized by all-the lending institutions and the countries concerned-that education becomes an important input in the success of the adjustment programmes, and hence investment in education is necessary for the very success and sustenance of structural adjustment programmes.