Globalization, Privatization and Liberalization Prof. dr. Marijk van der Wende CHEPS Summer School Vilnius 4-8 July 2005
Concepts and Definitions Globalization Privatization Liberalization GATS Borderless education Cross-border education Transnational education
Globalisation: A General Definition A process both driven by, and resulting in, increased cross-border flows of goods, services, money, people, information and culture (Held et al, 1999)
Globalisation Definitions: A Special Focus on Space and Time The intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa. (Giddens, 1990) Globalisation can be thought of as a process (or set of processes) which embodies a transformation in the spatial organisation of social relations and transactions assessed in terms of their extensity, intensity, velocity and impact generating transcontinental or interregional flows, and networks of activity, interactions, and the exercise of power. (Held, et al, 1999)
Globalisation of Higher Education A process in which basic social arrangements within and around the university become disembedded from their national context due to the intensification of transnational flows of people, information and resources. (Beerkens, 2004)
Privatization Privatization: to change / transfer (a service, business, industry, property) from governmental or public control or ownership to private control or ownership Privatization means taking services that are supplied by the government and turning them over to the private sector for provision and/or production (Rosen, H.S. (1999). Public Finance. p. 70).
Privatization of Higher Education Private higher education encompasses institutions of postsecondary study not owned and controlled by government. (Geiger)..Privatization is the process of institutional and sectoral differentiation upon the dimensions of legally defined private form of ownership and control, source of founding, mission and conditions for introducing market mechanisms in higher education '.
Liberalization Liberalization refers to a relaxation of previous government restrictions, usually in areas of social or economic policy. Most often, the term is used to refer to economic, especially trade liberalization Deregulation and privatization: two types of freeing or liberalizing higher education markets (Dill, 1997)
GATS General Agreement on Trade in Services (WTO) Market liberalisation (import export) Modes of supply: Cross-border supply (e.g. distance education) Consumption abroad (student mobility) Commercial presence (e.g. branch campuses) Presence of natural persons (academic mobility)
Borderless Education Educational provision that crosses what might be seen as traditional boundaries of: Time and space: study at any time and place Level: blurring boundaries between higher education, further, professional development and lifelong learning Control: the growth of private and corporate universities, public-private partnerships, and public universities operating private/for profit entities (Cunningham, 1997, CVCP, 1999)
Cross Border Education Situation where the teacher, student, programme, institutions/provider or course materials cross national jurisdictional borders. Main forms: student mobility, academic/trainer mobility, academic partnerships, e-learning, foreign campuses, foreign investment. (OECD, 2004)
Transnational Education Transnational Education denotes any teaching or learning activity in which the students are in a different country (the host country) to that in which the institution providing the education is based (the home country). This situation requires that national boundaries be crossed by information about the education, and by staff and/or educational materials. (GATE, 1997) International branch campuses, franchising operations, the provision of education by international non-official higher education institutions, off-shore institutions, foreign public universities, various consortia, and corporate universities (Adam, 2001). There are a variety of ways in which education is conducted transnationally, including via: distance education (with or without local support); twinning programmes; articulation programmes; branch campuses; and franchising arrangements (McBurnie & Pollock, 1998)
CBE: Four approaches Mutual understanding Academic, cultural, (geo)political, social, economic (networks of elites) Student mobility programmes Skilled migration Attracting highly skilled people for the knowledge economy Maintain / enhance competitiveness of HE/R&D sector Special programmes for foreign students Grants, visa, work permits Revenue generating HE as an export industry Using revenues to finance the domestic HE sector Full fees, for-profit branches abroad Capacity building Meeting growing demand for HE Enhancing the country s human capital Building a better HE system Foreign providers (regulated) Facilitate study abroad (& return)
The TNE Market Size: > 30 B$ for student mobility only (1998) Forecast of the market by 2025 (IDP)
Statistical Overview
Statistical Overview (2)
Statistical Overview (3)
Statistical Overview (4) Index of foreign students per domestic student Foreign students Domestic students abroad Denmark 12 547 6 144 Finland 6 288 9 678 France 147 402 47 586 Germany 199 132 54 481 Netherlands 16 589 11 792 Norway 8 834 14 072 Sweden 26 304 14 825 United Kingdom 225 722 25 195 Total EU+EFTA 845 556 412 459 Index 2.04-1.54 3.10 3.66 1.41-1.59 1.77 8.96 1.98
Statistical Overview (5) Top seven receiving countries United States United Kingdom Germany France Australia Japan Canada Total 30% 14% 13% 9% 7% 4% 3% 81%
The TNE Market (2) Students
The TNE market (3) Programmes
Conditions for the Development of TNE at National Level
Special Focus on Singapore (imports)
Special Focus on Australia (exports)
Special Focus on Virtual Universities
Special Focus on Private Companies In many cases the competitive threat is minor, tangential, or latent Relatively minor in absolute terms But recent years have witnessed significant recruitment growth among certain companies, international growth, and ambitious plans by new entrants
Impact on the HE Landscape Tier 1A institutions will remain standard bearers of prestige Tier 1B institutions will preserve their core academic programmes and traditional markets, but also seek innovation and new markets Tier 2A institutions will need to develop alliances or perhaps merge Tier 2B institutions will be severely challenged and desperate to survive Tier 3 institutions are those that are too conservative to change or to compete, or simply are victims of rapids shifts in number and type of providers (Douglas, 2005)
Impact on universities finances Australia Revenue from full-fee paying international students increased from 5.8% in 1995 to 12.5% in 2002 UK Income from full-fee paying students increased by 27,9% between 1995-2000 compared to a total increase in income of 8.6% 9.9% of total income in 2002
From the Press American Universities Step Up Their Sales Pitch Overseas: Costs and competition force colleges to hunt more aggressively for international students (The Chronicle of Higher Education, 11/2/2005)
From the Press (2) Oxford university is planning to cut the number of home and EU undergraduates from 10,400 to 8,500 and to expand its non- EU overseas undergraduates from 825 to 1,400 in order to improve its financial situation and at the same time to provide a more multi-cultural learning environment ACA Newsletter, March 2005
From the Press (3) Figures from HEFCE show that universities are predicting a further jump of 20% in overseas student numbers, compared with a 4% increase for home and EU undergraduates. International students are quite simply what makes it possible for the academic enterprise to continue public investment and fees do not cover the cost of teaching UK and EU undergraduates
From the Press (4) Australia is failing to meet demands for its local graduate professionals because it relies to heavily on skilled migrants and fee-paying students Instead of increasing the number of Australian graduates, the government boosted migrant intake and encouraged foreign students to become permanent residents. (THES, 15/4/2005)
Challenges for Governance & Policy Access and equity Financing and costs Privatization, liberalization, deregulation and GATS Quality & recognition Ethics fighting fraud Brain drain brain gain Policy coherence