Can education reduce inequality?
We may be heading towards a crisis. On one hand there is a serious dearth of skilled manpower and on the other hand there is the high unemployment rate
Md Eleus Mia
Besides climate change, perhaps growing inequality is the major challenge the world must have to address in the decades to follow. Like many countries, inequality in Bangladesh is widening reaching Gini-coefficient at 0.483 in 2015 from 0.453 in 2000, according to BBS. Where 1 indicates perfect inequality and 0 indicates perfect equality. But disproving numerous myths, the economy of Bangladesh kept soaring overwhelmingly since independence. Concurrently, the extent of inequality is expanding staggeringly which is a major headache of middle-class people. Inability to invest in education and health which constitute a persons capability to earn more leave him socially excluded. But many studies prove that inequality may be, on balance, beneficial for a certain phase of development while harmful to growth during another period. Moreover, growing inequality in a country is the root cause of exacerbating conflict, crime, social and political instability.
One hypothesis of this notion is that income inequality boosts economic growth by channeling resource towards well-off households who possess higher saving propensities. Secondly, the credit market imperfection approach which illustrates inequality reduce economic growth by impeding access to student loan and other financings human capital.
Much discussed Trickle down theory (development of the upper class would benefit rest of the society) and Kuznet curve (Inequality should necessarily increase during the early stages of development due to urbanization and industrialization and decrease later) proved wrong to bring significant change in development thinking. Now perhaps we can move towards Amartya Sens capability approach which extensively employed in the context of human development. It gives an explicit link between education and development where poverty is the deprivation in the capability to live a good life. If the person were to provided with opportunity and access to the resource that build his capacity to earn a better life that poverty will no longer exist. Here quality education and vocational training at an affordable cost may discern person to increase his income.
Economist Thomas Piketty rightly argued that knowledge and skill diffusion is the key to comprehensive productivity growth as well as the reduction of inequality both within and between countries. He like many others said when a country experience transition from agrarian to industrial economy it requires more skilled labour to perform a technology-based function. Thus, the industrialists have direct economic incentives to invest in education policies that would foster human capital formation. Consequently, labours share of income will rise as capitals share falls over a long period of time. Here, the main force in favor of greater equality has been the diffusion of knowledge and skills.
It has been found that countries that in 1960 showed greater inequality in the distribution of education have experienced lower investment rate than countries which showed less inequality. Policies, therefore, conducted to promote growth should not only take into account the level but also the distribution of education, generalizing the access to formal education at a different stage to a wider section of people.
The government always highlighted issues of development and GDP growth denying other indicators of the economy such as inequality, unemployment, and low wages etc. Infrastructural development has given utmost attention while non-infrastructural investment such as social spending particularly in education and health has been sidelined. It successfully secured massive victory in last polls drawing peoples attention in a number of mega projects of which many of them underway. Bangladesh remained one of the lowest countries in the world in terms of allocation for education never exceeding 2.5% of GDP while committed for 6% and a large chunk of this share goes straightly to paid teachers salary and infrastructure where research and development remain secondary.
There is an illustrious saying, Give a man a fish, and you feed him for a day. Teach a man to fish, and you feed him for a lifetime. If the person capable of earning a living by himself then need for a varied form of allowance will decrease. So, both the quantity and quality of education should be in concern of policy agenda. Yes, Bangladesh has a remarkable achievement in increasing school enrollment. But according to Bangladesh Bureau of Educational Information and Statistics) annual education survey-2017 drop-out rate remained static since many years which is 37.81 at the secondary level and 19.89 at the higher secondary level and its not obscure that low family income and poverty is at the crux of this problem. Moreover, high enrollment rate doesnt produce human capital as it reduces quality education in developing country like Bangladesh as we failed to cope with the growing demand of education sector (efficient and sufficient number of teacher, infrastructure, materials) and impart quality education that results in cognitive skills rather than promotion to next grade.
We are confronting the dilemma at one side the dearth of skilled manpower and higher unemployment rate on the other. There is no alternative but education to address this gap. According to Bangladesh labour force survey 2016-17, the proportion of people aged 15 or older who have no education is 30.6 percent, 22.3 percent completed primary education, 35.0 percent secondary education, 7.5 percent higher secondary and only 4.2 percent completed tertiary education. On the other hand, only 1.7 percent has received vocational training while 98.3 percent remained untouched.
This demonstrates the status of our workforce working in many industry and farm. The person who retains less education and skill ends up earning merely hand to mouth leaving no single penny to save. Thus, he becomes incapable to re-invest to himself or his offspring to get a quality education.
As Bangladesh embarks journey towards a developed nation it must go forward considering some option. The economists are alarmed that the world is on the horizon of another economic stagnation. If the country becomes rich in human resource we can survive even in a recession.
The writer is a contributor to
The Independent
