A hypothesis on how educational regimes differ

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1 Conservative States, Stratified Education, Unequal Opportunity A hypothesis on how educational regimes differ 2 nd version Daniel Horn PhD candidate Central European University and Mannheimer Zentrum für Europäische Sozialforschung Abstract Although conservative or corporatist states are identified as prioritizing the preservation of the status quo or status reproduction (Esping-Andersen, 1990), the link between education one of the major tools for reproducing social inequalities and the conservative welfare state is rather vague. Previously, the logic of the strong association between the vocational specificity of education being one of the most important selectivity advancing institutions and conservative states has been adequately shown (Estevez-Abe, Iversen, & Soskice, 2001), it is still unclear why conservative states score higher on other dimensions of educational selectivity as well. From the political economy research, however, it can be straightforwardly assumed that conservative states would use selective education to reproduce status differences. That is, historically, the conservative states would deliberately use tracking and other selective institutions to reproduce status differences, or similarly, today it is the conservative states that are less keen on reforming their highly selective education system. I use the PISA and other OECD data just as the two examples of Sweden and Germany to support this thesis both quantitatively and qualitatively. - Draft. Please do not quote without author s permission.- - Prepared for the ISA RC28 summer meeting in Montreal, Canada August August. 2007

2 Introduction Esping Andersen s Three Worlds of Welfare Capitalism identified the conservative states as countries where the preservation of the status quo or status reproduction is a priority (Esping- Andersen, 1990, 1999). Both theoretical and empirical research shows that conservative welfare state institutions harmonize with these ideals, in fact most of the research identifies the conservative states through their conservative policies, claiming that policies create politics (Pierson, 1993). Nevertheless there are only a few studies that have looked at the education system of the conservative states, in a comparative manner (Estevez-Abe et al., 2001; Hega & Hokenmaier, 2002). Since education is one of the main sources of status reproduction it should be straightforward to assume that conservative states utilize stratifying educational institutions in order to preserve the status quo. This study attempts to create a link between the conservative welfare state and its educational system. The first chapter describes the likely connection between stratifying education and conservative welfare states, claiming that since conservative or corporatist states emphasize status maintenance in order to preserve social integration, they should be using stratified education system that helps to achieve this goal. In the second chapter I offer some empirical tests on this argument. Using the international PISA data first I determine those institutions that associate closely with the educational inequality of opportunity, a proxy for intergenerational transfer of human and social capitals; then using these institutions I show that conservative states indeed use more stratifying institutions. The subsequent chapter presents the examples of Germany and Sweden to support the data presented before. The final section concludes and offers some further ways of research. The link between the conservative welfare state and stratifying education Educational stratification as major tool for social status reproduction: The two most common ways to categorize educational institutions is stratification and standardization. (Allmendinger, 1989; Kerckhoff, 2000; Shavit & Müller, 1998, 2000) The former usually refers to tracking, streaming, sorting or grouping of children; i.e. the phenomena that children with similar ability, socio-economic characteristics or interest are selected into separate groups/schools, and that there is little or no mobility between these. The latter can be understood as the degree to which the quality of education meets the same standard 2

3 nationwide, (Allmendinger, 1989). In this paper I will focus on the stratification dimension, keeping in mind that stratification is only one (group) of the educational institutions, so that further analysis is needed to clarify the connection between the welfare state and the standardization. Stratified education as a major tool for reproducing social inequalities is not a newborn idea in sociology (Bourdieu & Passeron, 1977; Bowles & Gintis, 1976, 2002), and more current qualitative as well as quantitative empirical research supports this belief. The most researched stratifying institution influencing equality is tracking. The logic behind the inequality advancing effect of early tracking/selection is that the earlier children are separated according to ability or merit, the more their family background will have an impact on this ability, and thus the more homogeneous groups of children will go to the same schools (Dustmann, 2004). Lower status families will also consider this choice a hurdle rather than a real option and thus family status will have a greater impact on this choice (Erikson & Jonsson, 1996a). Moreover if similar status children are grouped, peer-group effect will be smaller in lower status schools; relying on the observation that children s achievement depends not only on students own abilities but also on the average ability of the class, this selection will hurt lower status students more (Betts & Shkolnik, 2000). In addition to all this, if early selection clusters children into different tracks that are valued differently by the labor market, the family background will also have a major impact on future wages (Dustmann, 2004) and status of the child. Hence the more stratified a system is, the more the disadvantaged families will lose. Some studies use the recent internationally comparable datasets measuring students literacy scores to analyze the effect of stratification. Like that of Hanushek and Wössmann (2005) concluding that the results consistently indicate that early tracking increases inequality in achievement or Jenkins et al. (2006), who calculate two different indexes of segregation (dissimilarity index and the square root index) for 27 rich industrialized countries, and show that these indexes are the highest for those countries where separate school tracks for academic and vocational training exist. A model of Shütz et al. (2005) concerning tracking problems and other systemic features comes, again, to similar conclusions. Only a few of these studies consider an inequality of opportunity measure that can be equated with status reproduction more straightforwardly. Namely, Amermüller (2005) uses the effect of the student s parental background on their literacy scores and evaluate the impact of institutions on this measure; naturally, to understand this measure as a proxy for status reproduction one has to assume that the observed literacy scores as a proxy for human capital at a relatively young 3

4 age correlates strongly with the future status of the respondent students. Amermüller (2005) shows that streaming and private education benefit the performance of students from a better social background (27). In the next chapter I use a similar parental background effect indicator to proxy inequality of opportunity and evaluate the effect of stratifying institutions. Besides tracking, school choice is also a much researched institution that advances educational inequalities. Free school choice has long been in the focus of economists of education, arguing that it would raise school effectiveness; however free school choice can also lead to segregation by ability and social status. A model set up by Robertson and Symons shows that if schools and children are free to seek each other out: with some caveats, this leads to perfect segregation by child quality (2003, abstract), and since child quality is strongly correlated with parental background free school choice advances status reproduction. Similarly, empirical analysis on cross-sectional English data by Burgess et al. (2004) showed that sorting is greater where there is more choice, i.e. where students practice more their possibility of choosing another than their residential school, the sorting by ability and by income will be higher. Their results were underlined by Söderström and Uusitalo (2005), who looked at a recent natural experiment in Stockholm to see whether the introduction of school choice had an impact on the segregation between schools and between residential areas. The paper demonstrates rather clearly that school choice not only raises differences between schools and school areas in ability but also in social and immigrant status. Empirical investigations looking at labor market outcomes also show that in states with stratified educational systems occupational status is more closely determined by educational attainment. In stratified systems students are sorted early into tracks, which provide different educational qualifications that are easily recognized by the labor market. This strengthens the linkage between qualification and occupation. (Allmendinger, 1989; Kerckhoff, 2000; Shavit & Müller, 1998, 2000) Considering these, empirical and theoretical, studies it is likely that selecting children into different tracks in schools, especially at an early age, or offering the possibility for schools and children to seek each other out reduces or at least does not increase mobility between generations, i.e. helps status reproduction. 4

5 The welfare state as a system of reproduction: The welfare state is not just a mechanism that intervenes in, and possibly corrects, the structure of inequality; it is, in its own right, a system of stratification. It is an active force in the ordering of social relations (Esping-Andersen, 1990, 23). One of the major innovation of Esping-Andersen s pathbreaking volume on The Three Worlds of Welfare Capitalism (1990) was that he not only identified welfare states as systems of stratification, but also argued that different types of welfare states shape class and status in different ways. Accepting that not only politics make policies but policies create politics (cf. Pierson, 1993) one is able to look at the policy generated institutions such as for instance social insurance schemes and identify state politics (welfare state regimes) accordingly. 1 The institutional setup, the policies are shaped by the history, the previous politics of a given country and also have an impact on the future of it. Conservative states emphasize status maintenance as one of the major caretakers of social integration. Within these conservative, mainly continental European, nations late industrialization preserved the guild tradition until quite late, thus the largely hierarchical status differences and privileges remained modest even today; moreover the influence of the Catholic Church has also been great, further emphasizing the corporatist element (Esping-Andersen, 1990, 59-61). Social policy in the conservative states was not only influenced by this corporatist establishment, but as a consequence most of these countries were also led by conservative or Christian democratic parties forcing conservative policies. (Esping-Andersen, 1999) Welfare state typologies usually find that it is the conservative or corporatist states that employ occupational and status based differentiations in social insurance programs, distinct income and social security for civil servants, long-lasting unemployment benefits, employer-heavy social insurance tax burdens and union collective bargaining coverage (Hicks & Kenworthy, 2003), all of which are not only in line with the corporatist establishment, but also helps to sustain it in time. Liberalism can be considered as a quasi consequence of conservatism. It was the goal of the abolition of guilds, monopolies, estates and absolutism that urged individualism, emancipation, freedom, competition and the equality of opportunities. Laissez-faire social policy harmonized with these ideals. Practically, however, market failures necessitate some state intervention e.g. 1 See a comprehensive review of the welfare state typology literature by Arts & Gelissen (2002). 5

6 means-tested poor relief or other residual social security elements. This system creates its own stratification scheme: dualism and social stigma. Those, at the bottom, in need of state help are unavoidably stigmatized somewhat in a state emphasizing help to self-help and individualism, moreover, those at the top are the ones that can really utilize market forces to transfer their capital via generations. Esping-Andersen s (1990) third cluster of social stratification is the social democratic regime. Labor movements in these typically Nordic countries fought the atomizing liberalism just as the exclusionary corporatism. Its foremost principle, solidarity, required universalism both in the social policies and in politics. Institutional complementarities: status stratifying education status stratifying welfare state Education is only one, but maybe the most important policy that shapes politics. Esping- Andersen have also referred shortly to the centrality of education in determining stratification (Esping-Andersen, 1999). He claims that the emphasis on meritocracy and educational credentials introduced a new class filter (ibid, 20), the strength of which depends on the nature of the educational system: the more rigid it is (e.g. the less movement between tracks there are) the higher its polarizing effect is. Moreover, he argues, this difference between the educational systems is likely to strengthen the divergence between welfare states. It is no surprise that most of the authors comparing welfare state clusters with educational regimes find strong association between them (Estevez-Abe et al., 2001; Hega & Hokenmaier, 2002). Hega and Hokenmaier (2002) addressing the association between welfare states and education look at macro variables such as spending on education, public spending or the enrollment in vocational training and conclude that educational systems cluster according to the Esping- Andersen s regimes. States exhibit the tendency to choose between educational opportunities or social insurance programs as alternative policy strategies (2002, 1). They argue that this clustering of education is due to a different choice of the trade-off between the government investment in public education and spending for social policy (in percentages of all public expenditures). They also observe that conservative states have the highest enrollment in vocational training, arguing that the reason is that in these countries social insurance tends to support maintenance of the status quo and more limited social mobility (Hega & Hokenmaier, 2002, 10). This observation, in my opinion, is a crucial point in connecting the conservative welfare state with its educational system. Although I believe that Hega and Hokenmaier are 6

7 correct observing this, they fail to explain why the vocational education leads to status maintenance and limited social mobility, and why it is the conservative states and not the others that exhibit this characteristic. Estevez-Abe, Iversen and Soskice (2001) have provided an appealing theory that connects the vocational specificity of educational systems with the welfare state, i.e. the type of social protection. They argue that the inherent features of the educational system go hand in hand with that of the labor market. In states with high ratio of vocationally oriented education the labor market regulations will protect the workers; social protection both employed and unemployed protection will be high. On the other hand, in systems with no strong association between credentials and occupation (i.e. less stratified systems) social protection will be smaller. The key to this argument is the composition of skills. Vocationally oriented systems offer specialized skills, that are useful for only few firms/industries, and are hardly transferable in between. People will only invest in these specific skills, if they see that their future is secured, if their investment risk is low. This security can be provided by the state, with high social protection, robust employer and unemployment protection. On the other hand, in states with no or small social protection people rather invest in transferable, general skills, that are valuable for many industries/firms, therefore protecting themselves, that even if unforeseen consequences abound they still can transfer themselves between firms/industries. The less stratified (no vocational vs. academic distinction) education systems provide these general skills. Hence the system of education the skill specifying regime and the social protection of the state should necessarily go together. The two archetypical cases would be the highly stratified German educational system, with high social protection; and the less stratified system of the United States, with very weak social protection. Their argument on the complementarities between the social protection regime and the educational system, and the effect of these on the individual strategies (in which type of human capital to invest), does indeed elucidate the association between vocational training and strong corporatism. However they do not consider the general selectivity of the system (of which vocational training is only one aspect), and do not look at the inequality of opportunity the education creates. Besides Estevez-Abe, Iversen and Soskice s (2001) study the literature so far is in debt in explaining the link between conservative states and stratifying education. If we take Esping-Andersen s (1990; 1999) argument on the stratifying characteristics of the conservative states we should expect that conservative states have also a highly stratifying 7

8 educational system as well. So that they not only use vocationally specified training explained by Estevez-Abe et al. (2001) -, but they also have other selective institutions; e.g. select the students at an earlier stage, have more types of tracks, select the children more at secondary school entrance and have more free school choice. The logic Conservative states, according to Esping-Andresen (1990), are the ones where the preservation of status differentials is important, rights are attached to class and status, and decommodification is moderate. Education has long been seen as one of the most important tools for status reproduction (Bourdieu & Passeron, 1977) and the above listed empirical research and data below also show that stratified educational institutions are important means to achieve this. If we consider educational institutions policy-amenable (i.e. they could be formed and maintained by policy makers), stratified education could facilitate status maintenance by helping to transfer human capital between generations; thus there would be a smaller opposition towards these institutions in conservative states than in other (e.g. liberal or social democratic) countries. This argument is true for the vocational specificity of the education system, as well as for the other stratifying institutions. 2 The institutionalist logic of path dependency and feedback can easily be applied to this link. As Krasner observes: Path dependent patterns are characterized by self-reinforcing feedback. [ ] Once a particular path is chosen, it precludes other paths even if these alternatives might, in the long run, have proven to be more efficient or adaptive (Krasner, 1988, 83). There are two broad types of feedback mechanisms (cf. Krasner, 1988; Thelen, 1999). The first, rather functional logic claims that once a set of institutions is in place, the actors will adopt their strategies to respond and also to reinforce the system. This logic was applied by the quoted Estevez-Abe et al. (2001) argument, and also by its host the renowned Varieties of Capitalism volume (Hall & Soskice, 2001). The second logic revolves around the idea that institutions are not neutral coordinating mechanism, but they reproduce and even intensify power distributions within society. This body of work emphasizes that political arrangements and policy feedbacks 2 The labor market of the conservative states necessitates a well functioning supply of specific skilled workers, where state finances the training costs through relatively high taxes paid by firms. The vocational specificity of an educational system, however, not only provides well trained specified workforce, but can easily work as a tool for stratification based on social status (Horn, Balazsi, Takacs, & Zhang, 2006; Shavit & Müller, 2000) 8

9 actively facilitate the organization and empowerment of certain groups, while actively disarticulating and marginalizing others. (Thelen, 1999, 394) Stratifying education clearly helps the socially more advantaged groups, meanwhile, if we assume that more educated people have a larger impact on future state policies, it also marginalizes the policy impact of the disadvantaged. Note, however, that although the path dependence logic is easy to apply for conservative states and their stratifying educational system, it cannot answer the problem of institutional change; that is, for instance, why did Sweden change its educational system from stratifying to comprehensive? (See the last chapter.) Soothing it might be to recall that even theoretical institutionalism struggles with the general explanation of institutional change (Pierson, 2004, ch5.; Rittberger, 2003), however it does not answer our question. In the following I offer quantitative as well as qualitative support for the hypothesis on the link between conservative states and stratifying education. I test the assumption claiming that conservative institutions have not only higher ratio of vocational training, but also more stratified education system in general. Then I show how the stratified German education kept its main characteristics throughout the century, while the initially similar Swedish education became more comprehensive. Empirical support Institutions and educational outcomes Based on the Programme for International Student Assessment (PISA) 2000 and 2003 data, and on other OECD sources (mainly Education at a Glance, hereafter EAG) (OECD, 2004, 2005a) I analyze the association between the student family background effect and educational institutions, a test how education associates with the equality of opportunity. Although previous empirical studies, cited above, have already analyzed this issue they focused more on different measures of educational inequality e.g. the variance of the outcome, or the strength of association between the outcome and the institutions and not the inequality of opportunity measure used here; however I believe this measure is more in line with the goals of the welfare state. 9

10 Educational inequality of opportunity here is understood as the effect of the pupils economic, social and cultural background (escs) index 3 (hereafter parental background) on their mathematical and reading literacy scores; i.e. the more the parental background affects the students literacy score the more unequal the society is. This indicator should be understood as some sort of intergenerational transition of social status measure, and it proxies the equality of opportunity, as compared to the variance of the literacy scores which shows the equality of outcome. Note that I assume that the measured reading and mathematical literacy score is an adequate proxy for human capital, and that it correlates strongly with the unobserved future status of the students. (cf. Becker, 1993) A two-step estimation procedure was utilized for the analysis: separate individual level linear OLS regressions (1 st step) were ran for each country, 4 and Feasible Generalized Least Squares (FGLS) regressions (using the inverse square-root of the variance of the estimated coefficients as weights) estimating the impact of educational institutions on the estimated parental background coefficient, were applied in the 2 nd step. 5 The two-step procedure is very similar to a one-step hierarchical multilevel estimation: both procedures provide unbiased and effective results and face similar methodological challenges (Franzese, 2005; Jusko & Shively, 2005; Lewis & Linzer, 2005). One major advantage of the two-step procedure is its comprehensiveness: it offers an apparent possibility of visual representation on the estimated 2 nd level; a feature that is thoroughly utilized in this paper. Nevertheless the hypotheses below were tested with both twostep and multilevel estimation procedures (the latter not presented here), with virtually similar results. The outcome variables in the 1 st step were the PISA 2000 and 2003 mathematical and reading literacy scores. Since PISA provides five plausible values for each literacy field (OECD, 2005c), ten 1 st step regressions were run for each country, and the mean of the estimated escs coefficients were taken as the dependent variable for the 2 nd step. Besides the students economic, social and cultural status index (escs), grade, gender, family structure, language at home and immigrant status (1 st or 2 nd generation) were controlled for. Both the literacy scores and the escs index were standardized within country when estimating the inequality of opportunity, in order to estimate 3 The escs index initially was only calculated for the PISA 2003 data, but later it was computed for the 2000 data as well. Although the two indexes were calculated somewhat differently, they are duly comparable. (OECD, 2005c, 317) I thank Yanhong Zhang of the UNESCO Institute for Statistics for providing me the necessary files for computing the escs index for the PISA 2000 database. 4 In order to estimate sampling and imputation variance correctly PISA requires BRR (balanced repeated replication) weighting. For more on this see PISA 2003 Technical Report (OECD, 2005c) and the PISA 2003 Data Analysis Manual (OECD, 2005b). 5 Dummies to control for possible differences between the PISA surveys were also included in the second step. 10

11 the net parental background effect. I have also merged the two PISA datasets into one, in the 2 nd step analysis in order to increase the number of cases. 43 countries have participated in the PISA 2000 and 41 in the PISA 2003 study; additional information were mainly available only for the OECD countries plus we can assume less differences in the unobserved state characteristics for these; hence I have included only the OECD states in my investigation; moreover France has not provided school level data in 2003, thus were dropped from most parts of the analysis. The remaining countries are: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, Germany, Greece, Hungary, Iceland, Ireland, Italy, Japan, Republic of Korea, Luxembourg, Mexico, The Netherlands, New Zealand, Norway, Poland, Portugal, Slovakia, Spain, Sweden, Switzerland, Turkey, United Kingdom, United States. 6 I have used the following proxies of stratification: (See appendix A1. for descriptive data) Tracking (+) Ratio of previous academic record is a prerequisite for attendance (PISA 2003 School questionnaire: Question 10); henceforth: academic selection (+) Number of school types at age 15 (EAG 2005, D6.1); henceforth: number of school types (-) Age of selection to secondary school (EAG 2005, D6.1); henceforth: age of selection School choice (-) Ratio of residence is a prerequisite for attendance (PISA 2003 School questionnaire: Question 10); henceforth: catchment area (+) Percentage of fully independent private schools (PISA 2003 School questionnaire: Question 3); henceforth: ratio of private schools Percentage of vocational training (+) Percentage of upper. secondary enrollment in prevoc./vocational programs (EAG 2005 C2.1); henceforth: ratio of vocational training Note: The signs in parentheses show the suspected association between the proxies and the unobserved stratification dimensions. 6 Slovakia and Turkey were not in the PISA 2000 study. 11

12 Out of the above tracking proxies the number of school types and the age of selection are often used indicators of tracking; however the academic selection proxy is unique. In the PISA 2003 school questionnaire the headmasters were asked about their selectivity procedures, this proxy shows the percentage of those headmasters, who stated that they take the student s academic record (including placement test) into account. This measure, at first glance, is a straightforward indicator of meritocratic selection; however in practice secondary school placement tests (or especially the less objective grades in primary school) correlate largely with the previous, outside-of-school socialization of the students. (On early life socialization see for instance the debate between Heckman and Krueger and others in economics (Heckman & Krueger, 2003), or Erikson and Jonsson (1996a) or Esping-Andersen (2006) in sociology.) Therefore this proxy can also be understood as a simple selection indicator as opposed to the catchment area (an antischool choice proxy), where the headmasters stated that they take the residence of the student into account. 7 The other proxies should be straightforwardly matched with the unobserved stratification dimension. Subsequently I will test the hypotheses that stratification increases inequality. Results: Table A2. in the appendix provides 6 separate regressions for each proposed institutional proxy, where the coefficients can be interpreted similarly to simple correlation. Although none of the signs are significant all but one of the institutional coefficients show the assumed effect: stratification increases inequality of opportunity. Figure 2. below offers visual representations of the associations between the inequality of opportunity and the separate institutions. Note that although the ratio of private schools seems to associate negatively with the inequality of opportunity, this is probably only due to the few outlier cases. The lack of significant relationship can be attributable to two major problems of the used data. The more obvious is the small number of cases; since stratification is only one of the dimensions explaining the inequality of opportunity, there could be considerable variations owing to other, unobserved factors, such as for instance standardization or other state level characteristics. The second, more data oriented problem is that we look at students of age 15 and that at this age the institutional effects are not as clearly observable as at later stages, especially because most of the selective countries select children at age 14, this leaving only 1 year for the effect to realize. 7 The catchment area indicator could mean that children either cannot choose another school but the one in their residential area or even if they can, those living near the school have an advantage at entrance; so the school cannot select. 12

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