Privatization of Education: History, Causes, Implementation, and Effects

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Table of Contents

Introduction
Definition
History
Motives
Modes
Policies
Effects of Privatisation
Conclusion
Bibliography
Footnotes

Introduction

Private education has become increasingly prominent during the last several decades and, by now, occupies a prominent place in the educational systems of many countries which have hitherto been entirely or mostly public. The process itself is evident and undeniable, and the research on it is also plentiful and aims to address numerous aspects of this still-on-going trend. At the same time, there are still disagreements about the overall effects of private education as compared to the public one. This paper will offer s general coverage of the privatisation of education, including its history, motives, modes, policies, and positive and negative effects alike.

Definition

Before delving into a thorough coverage of the different aspects of education privatisation, it is necessary to define, at least firefly, what it is in the first place. Generally speaking, privatisation refers to the “transfer of activities, assets, and responsibilities from government/public institutions and organisations to private individuals and agencies.”¹ Applied to education, it means a set of policies and models that lead to deregulation of educational service resulting in competition between public and private education providers.² With this in mind, it is fairly obvious that, in education, privatisation – that is, the transfer of assets and responsibilities from public to private actors – is closely related to marketization – that is, the encouragement of competition for the customer that should presumably lead to the improvement in the service quality. Hence, for the purpose of this paper, one may define privatisation of education as the transfer of educational services from public to private domain via the variety of policies and approaches accompanied by increasing marketization of education services and overall deregulation of the field.

History

Historically speaking, the theoretical foundation for privatised education goes back at least to the liberal thinkers of the 18^th and 19^th centuries. Given the aforementioned connection between privatisation and marketization, it is hardly surprising that proponents of the advantages of the free market were the ones to develop the idea in some detail. Adam Smith was arguably the first who started the debate soon after the introduction of then-limited systems of public education.³ In particular, he introduced and developed the idea of an educational voucher that is currently in use in many countries, from Chile to the USA.⁴ Similarly, John Stuart Mill also reflected on the comparative advantages and disadvantages of private education as compared to the public one.⁵ While these philosophers did not necessarily apply their ideas to the creation of private educational enterprises in practice, they did, nevertheless, create a theoretical foundation for such attempts later on.

Privatisation of education in its current form largely begins its history since the 1980s. Until this decade, education remained a predominantly public affair, being sponsored, organised, and provided by the state. The status of education as a universal right supported by the Universal Declaration of Human Rights, which also proclaimed that its elementary and fundamental stages have to be free, supported this status quo as well. However, the 1980s saw increasing attention to the privatisation of education in the form of both public-private partnerships and entirely public for-profit schools. According to Marxist historians, this tendency emerged as the response of the capitalist governments to the economic crisis in the 1980s.⁶ Another perspective points to the fact that the 1980s just happened to be the decade when the gradually accumulated evidence regarding the poor efficiency of public education and the advantages of privatisation became sufficient to mandate attention.⁷ Regardless of the particular reason, there is no arguing that the trend toward private education supported by governments and international organisations has been present for the past three-to-four decades.⁸ Moreover, this trend shows no sign of abating, as demonstrated by the statistical evidence.

Research shows that many statistical indicators directly relevant to the prominence of a given educational model have grown several times at the end of the 20^th and the beginning of the 21^st century. First and foremost, the share of private expenditure on educational institutions across all levels has risen considerably and, as of 2011, ranges from 40% in Chile to approximately 15% in the Slovak Republic or Germany.⁹ The percentage of enrolment in private educational institutions has risen in the countries with all levels of income from 3-11% in 1990 to 10-16% in 2012.¹⁰ Countries with upper income levels demonstrated the most consistent growth from approximately 3 to almost 9%.¹¹ Moreover, this tendency remains more or less consistent across most regions of the contemporary world. For example, the percentage of enrolment in private primary education institutions demonstrates virtually identical growth in Latin America and the Caribbean on the one hand and the Middle East and North African on the other hand, each rising by approximately 6% between 1900 and 2012.¹² In short, recent history demonstrates a persistent worldwide trend toward private education.

Motives

The growing prevalence of private schooling as compared to the traditional state-run public education means that the actors involved in shaping educational policies consistently and continuously push it in this direction. This begs the legitimate question of what are the motives that serve as the primary driving force behind this process. This section will cover three major motives for the privatisation of education as identified in research – namely, economic expediency, efficiency, and proselytism.

Economic Expediency

Economic and administrative expediency is one of the motivations behind the political encouragement of education privatisation. The reasoning is simple: delegating educational services to private providers potentially allows the government to limit its educational spending. In this regard, economic expediency motivation is particularly appealing for low-income countries with limited financial resources and a growing population.¹³ Apart from that, some studies posit that the privatisation of education is a natural response of the capitalist world-system to the challenges of recurring crises, such as the economic crisis of the 1980s or the financial crisis of 2007-2008.¹⁴ In short, the economic expediency motive perceives privatisation as the way to reduce government expenditure on education without neglecting it altogether.

Efficiency

Efficiency is one more motive behind the on-going switch to privatised education. If the expediency motive discussed above focuses on reducing government spending, efficiency is concerned with making it more productive. This motive aims to achieve greater gains per same investment by either transferring educational services into private hands or introducing the elements of market competition between the public-owned education providers.¹⁵ Naturally, this approach entirely rests on the premise that near-monopolistic public service providers do not perform as efficiently as those that operate in a competitive system.

Religion

Not as prominent and pervasive as the other two, religion can, nevertheless, be an important motivation behind private education in its own right. Historically speaking, proselytising missionary zeal has been one of the cornerstone factors behind the establishment of religious schooling, which has remained as a separate non-state-owned educational network in many countries.¹⁶ Such countries as Spain, Belgium, and the Netherlands have historically strong traditions of religious schooling, and religious schools, by their very existence, serve as a potential alternative to state-run public schools.¹⁷ As such, they represent the still-present religious motivation of actors other than the state to offer educational services in competition with the state schools.

Modes

As mentioned in the definition section, governments employ a broad range of different modes when privatising the once-public field. These modes – or, simply put, forms – of privatisation differ in the interplay of private and governmental functions and the specific responsibilities assigned to public and private actors. The three most prominent modes of education privatisation are outsourcing of specific activities, market-based governance, and the introduction of entirely private educational institutions, including the explicitly for-profit ones.¹⁸ This section will cover each of these modes in succession, identifying their characteristic features and application.

Outsourcing

Outsourcing of the specific government activities related to education to the private providers is one of the more limited modes of privatisation in education. In this approach, the educational services themselves usually remain the prerogative of the public actors, which develop programs, establish curricula, and hire and monitor educators who deliver knowledge to the students. The outsourced areas may include management – for example, when a private actor provides services aimed to improve the educational institutions’ financial performance.¹⁹ Similarly, public actors governing educational institutions may contact private providers for technical services, such as transportation or meals and textbook delivery, and professional services, such as teacher training, quality assurance, and other activities supplemental to the educational process.²⁰ Thus, in most cases, outsourcing refers to the activities relevant to the educational prospects but not the delivery of education itself.

Another example of outsourcing is the integration of private preparatory course companies into public primary school settings. Some authors refer to this practice as “hidden privatisation” because, even while the educational system may remain entirely public-funded, allowing preparatory course companies to advertise their services as a part of the school curriculum enables private actors to influence education in a subtler way.²¹ Yet while this type of outsourcing allows private actors to actually participate in distributing knowledge by preparing students for the admission exams, they still only have an indirect impact on the otherwise public education system.

Governance

Another form that the privatisation of education can take is changing the principles of governance in the field. This mode seeks to apply the governance methods used in business and other competitive areas to increase the level of competition between educational institutions and, presumably, improve the overall quality of educational services. This mode, more than any other, signifies the connection between privatisation and marketization mentioned above. Firstly, this mode rests on the premise that the market-based competition for the limited number of customers will force educational institutions to improve their management and educational practices toward greater efficiency.²² Apart from that, educational institutions can also engage in competition for legitimacy to prove their viability and the absence of need for reform.²³ This mode seems to be the most prevalent among the approaches to the privatisation of education, and some researchers call the governance reconfiguration the “greatest impact” of privatisation so far.²⁴ In fact, some authors even insist there is a “competition fetish” in the privatisation of higher education.²⁵ Be that as it may, there is no arguing that the introduction of competitive elements into education governance remains a prominent privatisation mode.

Private Schooling

Apart from the two modes listed above, there is also the third one, which epitomises the extreme end of the education privatisation spectrum. In this mode, private actors are responsible not merely for technical or auxiliary activities, as in the outsourcing mode, but for the delivery of educational services to the students. Such educational institutions may be partially state-funded or purely private and act in compliance with the governmental regulations or entirely independently.²⁶ Generally speaking, such institutions exercise considerable influence over the structuring and contents of the educational process. Even when the schools in question are government-sponsored, private actors still retain control over curriculum, staffing, and other organisational aspects.²⁷ This mode is particularly prominent in low-income countries with the governments unwilling or unable to address the growing need for primary education.²⁸ In this case, low-fee private schools emerge and target the disadvantaged population while the government, in return, exercise little, if any, control in terms of educational standards.²⁹ With this in mind, private schools as a mode represent the privatisation of education taken to its logical outcome.

Policies

While modes are the forms which the privatisation of education can take, there are also methods of approaching it – that is, the policies that the governments enact to encourage and achieve it. The most significant and widely-used among those are educational vouchers, chartered schools, and the lassez-aller approach. This section will cover each of these in succession, highlighting their characteristic features and correspondence to the modes discussed above.

Vouchers

The use of educational vouchers is the policy that consists in issuing coupons – the titular vouchers – that entitle students to a predetermined amount of schooling and can be used to receive it in various educational institutions. Introducing the element of choice into education serves to promote competition and, by the design of the policy, increased quality of educational services.³⁰ The voucher system is most widely used in the United States (local and state level) and Chile (national level).³¹ It is easy to note that this method is close to the governance mode discussed above and primarily focused on encouraging competition as the main way to raise the quality of educational services.

Chartered Schools

Chartered schools are educational institutions that are recognized and partially funded by eh government but are privately owned and exercise considerable influence over curriculum, staffing, and educational programs. Still, this autonomy is not absolute, and its degree depends on the specific conditions of the charter that the founding actor makes with the authorities.³² They are not as divisive as the universal voucher programs, which is why they can serve as a less ideologically charged middle option for different political forces.³³ It is most likely because such schools represent the middle ground between state-run public schools and purely private education.

Lassez-Aller

As mentioned above, not all states have the resources and the willingness to provide educational services sufficient to satisfy the growing demand. In this case, they are most likely to adopt the policy of lassez-aller, which literally means the absence of restraint. It amounts to exactly what the name suggests: private actors open schools, predominantly low-fee and in the primary education sector, and the government barely involves itself in the process.³⁴ While it can provide an ample supply of educational services that correspond to the demand, this policy threatens a sharp decline in education quality.³⁵ It is the closest one to the purely private schooling form of education privatisation as described above.

Effects of Privatisation

Positive

One positive effect of school privatisation that is often stressed by their proponents is the better quality of education that they offer. Research suggests that teacher presence and the range of teaching techniques used are generally better in private schools.³⁶ Educational outcomes also seem to bet better, especially in low-income neighbourhoods.³⁷ In a similar vein, the management in public schools also tends to be more efficient than in public enterprises.³⁸ This increase in the quality of services provided is the main positive impact of privatised education.

Apart from that, education privatisation reduces the risk of exploiting the educational system in favour of political agendas. Mill advocates privatised education for this very reason, arguing that the government can all too easily turn the state-run schools into a vehicle of ideological indoctrination.³⁹ Chile’s educational system, characterized by the highest level use of educational vouchers in the world, is also known as one of the most depoliticized.⁴⁰ Hence, one more positive effect of education privatisation is the reduced risk of schools being used for political propaganda.

Negative

The most oft-criticised negative effect of privatised education is the threat to equal access that it poses. Numerous studies suggest that the increasing prominence of educational vouchers and charters schools leads to the segregation of the educational system based on socio-economic criteria and, by extension, to the marginalization of economically vulnerable groups.⁴¹ The introduction of charter schools results in decreased financing for traditional public schools, affecting education quality.⁴² Moreover, even when the educational system is public, the introduction of private preparatory course companies into public schools setting favours those who can afford their services and indirectly decreases the chances of enrolment for those who cannot.⁴³ Hence, the first negative effect of privatised education is the threat of socio-economic segregation.

Similarly, privatisation of education also runs the risk of higher levels of racial discrimination. Different legal regulations applied to public and private spheres, as well as the insufficient attention to the matter in charters between the private actors and the government agencies may create favourable conditions for the development and reproduction of racist practices.⁴⁴ Specific examples of discrimination occurring in charter schools include colour-blind racism and the perpetuation of white saviorism narratives.⁴⁵ Thus, privatisation of education may promote discrimination not only in socio-economic but also in racial terms.

Finally, research suggests that privatised education may also have yet another negative societal impact in the long run. One study demonstrates that the parents educating their children in private schools statistically become disposed toward the more extensive forms of parental partiality – that is, the willingness to provide their children with positional advantages regardless of the possible social outcomes.⁴⁶ While potentially providing individual benefits, this effect undermines the overall social benefits of education as a public good.

Conclusion

To summarize, privatisation of education is an on-going trend that shows no signs of abating. Theoretically justified in the works of liberal philosophers, it has been on the rise since the 1980s. Motivations behind the introduction of private actors into the educational field include economic expediency, efficiency, and religion. Privatised education may take forms of outsourcing, competition-based governance, and entirely private schooling and is most often realised through such policies as educational vouchers, charter schools, and lassez-aller approach. While the proponents of privatisation stress that it offers high-quality depoliticized education, research has also identified numerous drawbacks, including socio-political segregation, racial discrimination, and a decrease in overall social benefits of education due to parental partiality.

Bibliography

Anomaly J, ‘Pubic Goods and Education’ in Andrew I. Cohen (ed) Education and Public Policy (Rowman & Littlefield 2018) 105.

Ashley LD and others (2014). EPPE Centre Report 2206.

Bayram A, ‘The Reflection of Neoliberal Economic Policies on Education: Privatisation of Education in Turkey’ (2018) 7(2) European Journal of Educational Research 341.

Belfield CR and Levin HM, Education Privatisation; Causes, Consequences, and Planning Implications (International Institute for Educational Planning 2002).

Bhattarai T, ‘Exploring privatisation in education: Nepal as a case of study’ (MA thesis, Katholieke Universiteit Leuven 2009).

Boterman W and others, ‘School segregation in contemporary cities: Socio-spatial dynamics, institutional context and urban outcomes’ (2019) 56(15) Urban Studies 004209801986837.

Campbell J, Hankey A and Seiden J, ‘Can Parental Choice Improve Education for All?’ in Pasi Sahlberg and others (eds), Hard Questions on Global Educational Change: Policies, Practices, and the Future of Education (Teachers College Press 2010) 13.

Carrasco A and Helen M Gunter ‘The ‘Private’ in the Privatisation of Schools: The Case of Chile’ (2019) 71(1) Educational Review 67.

Cohodes C, ‘Charter schools and the achievement gap’ (2018) The Future of Children 1.

Dash N, ‘Privatisation and Education’ (Educational Resources Information Centre, 2009).

Exley S and Suissa J, ‘Private Schools, Choice and the Ethical Environment’ (2013) British Journal of Educational Studies 61(3) 345.

Gilraine M, Petronijevic U and Singleton JD, ‘Horizontal Differentiation and the Policy Effect of Charter Schools’ (2021) 13(3) American Economic Journal: Economic Policy 239.

Härmä J, ‘Ensuring Quality Education? Low-Fee Private Schools and Government Regulation in Three Sub-Saharan African Capitals’ (2019) 66 International Journal of Educational Development 139.

Kosunen S, ‘Access to Higher Education in Finland: Emerging Processes of Hidden Privatisation’ (2016) 4(2) Nordic Journal of Studies in Educational Policy 67.

Ladd HF and Singleton JD, ‘The fiscal externalities of charter schools: evidence from North Carolina (2020) 15(1) Education, Finance & Policy 191.

Lee ANY and Bagley C, ‘School choice with education vouchers: an empirical case study from Hong Kong’ (2017) 26(1) International Studies in Sociology of Education 3.

Lubienski C, ‘Sector Distinctions and the Privatisation of Public Education Policymaking’ (2016) 14(2), Theory and Research in Education 206.

Madsen M ‘Competitive/comparative governance mechanisms beyond marketization: A refined concept of competition in education governance research’ (2020) European Educational Research Journal.

Mead JF and Eckes SE, How School Privatization Opens the Door for Discrimination (National Education Policy Centre 2018).

Naidoo R, ‘The Competition Fetish in Higher Education: Shamans, Mind Snares and Consequences’ (2018) 17 European Educational Research Journal 605.

Nijs B, ‘Privatisation in Education’ (MA thesis, Leiden University 2017).

Noguera PA, ‘More Democracy, not Less: Confronting the Challenge of Privatisation in Public Education’ (1994) 16(2) Journal of Negro Education 237.

Patrinos HA, Barrera-Osorio F and Guaqueta J, The Role and Impact of Public-Private Partnerships in Education (World Bank 2009).

Pedró F, Leroux G and Watanabe M (2015) UNESCO Working Papers on Educational Policy 02 4.

Riel V and others, ‘Do magnet and charter schools exacerbate or ameliorate inequality?’ (2018) 12(9) Sociology Compass e12617.

Rizvi F, (2005) UNESCO Education Research and Foresight Working Papers 18.

Rooks N, Cutting School: The Privatization, Segregation, and the End of Public Education (The New Press 2018).

San Juan DMM, ‘Neoliberal Restructuring of Education in the Philippines: Dependency, Labor, Privatization, Critical Pedagogy, and the K to 12 System’ (2016) 16(1) Asia-Pacific Social Science Review 80.

Sondel B, Kretchmar K and Dunn AH, ‘“Who Do These People Want Teaching Their Children?” White Saviorism, Colorblind Racism, and Anti-Blackness in “No Excuses” Charter Schools’ 2019 Urban Education.

Verger A, Fontdevila C and Zancajo A, The Privatisation of Education: A Political Economy of Global Education Reform (Teachers College Press 2016).

Footnotes

Neena Dash, ‘Privatisation and Education’ (Educational Resources Information Centre, 2009). Web.
Francesc Pedró, Gabrielle Leroux and Megumi Watanabe (2015) UNESCO Working Papers on Educational Policy 02 4.
Janine Campbell, Aline Hankey and Jonathan Seiden, ‘Can Parental Choice Improve Education for All?’ in Pasi Sahlberg and others (eds), Hard Questions on Global Educational Change: Policies, Practices, and the Future of Education (Teachers College Press 2010) 14.
Noguera PA, ‘More Democracy, not Less: Confronting the Challenge of Privatisation in PublicEducation’ (1994) 16(2) Journal of Negro Education 237.
Jonathan Anomaly, ‘Pubic Goods and Education’ in Andrew I. Cohen (ed) Education and Public Policy (Rowman & Littlefield 2018) 114.
Arslan Bayram, ‘The Reflection of Neoliberal Economic Policies on Education: Privatisation of Education in Turkey’ (2018) 7(2) European Journal of Educational Research 346.
Pedró, Leroux and Watanabe (n 2) 4.
Fazal RIzvi, (2005) UNESCO Education Research and Foresight Working Papers 18 2.
Antoni Verger, Clara Fontdevila and Adrián Zancajo The Privatisation of Education: A Political Economy of Global Education Reform (Teachers College Press 2016) 5.
Ibid. 4.
Ibid. 5.
Ibid.
Ibid. 89.
Bayram (n 6) 346; David Michael M. San Juan ‘Neoliberal Restructuring of Education in the Philippines: Dependency, Labor, Privatization, Critical Pedagogy, and the K to 12 System’ (2016) 16(1) Asia-Pacific Social Science Review 80.
Teeka Bhattarai ‘Exploring privatisation in education: Nepal as a case of study’ (MA thesis, Katholieke Universiteit Leuven 2009) 23; Michael Gilraine, Uros Petronijevic and John D Singleton, ‘Horizontal Differentiation and the Policy Effect of Charter Schools’ (2021) 13(3) American Economic Journal: Economic Policy 239.
Ibid.
Antoni Verger, Adrián Zancajo and Clara Fontdevila ‘Multiple Paths towards Education Privatisation in a Globalizing World: A Cultural Political Economy Review’ (2017) 32(2) Journal of Educational Policy 13-14.
Pedró, Leroux and Watanabe (n 2) 5.
Harry Anthony Patrinos, Felipe Barrera-Osorio and Juliana Guaqueta, The Role and Impact of Public-Private Partnerships in Education (World Bank 2009) 9.
Ibid.
Sonja Kosunen, ‘Access to Higher Education in Finland: Emerging Processes of Hidden Privatisation’ (2016) 4(2) Nordic Journal of Studies in Educational Policy 75.
Bart de Nijs ‘Privatisation in Education’ (MA thesis, Leiden University 2017) 6.
Miriam Madsen ‘Competitive/comparative governance mechanisms beyond marketization: A refined concept of competition in education governance research’ (2020) European Educational Research Journal. Web.
Christopher Lubienski ‘Sector Distinctions and the Privatisation of Public Education Policymaking’ (2016) 14(2), Theory and Research in Education 206.
Naidoo R, ‘The Competition Fetish in Higher Education: Shamans, Mind Snares and Consequences’ (2018) 17 European Educational Research Journal 605.
Pedró, Leroux and Watanabe (n 2) 5.
Alejandro Carrasco and Helen M Gunter ‘The ‘Private’ in the Privatisation of Schools: The Case of Chile’ (2019) 71(1) Educational Review 78.
Verger, Fontdevila and Zancajo (n 9) 89.
Joanna Härmä, ‘Ensuring Quality Education? Low-Fee Private Schools and Government Regulation in Three Sub-Saharan African Capitals’ (2019) 66 International Journal of Educational Development 139.
Clive R Belfield and Henry M Levin, Education Privatisation; Causes, Consequences, and Planning Implications (International Institute for Educational Planning 2002) 50; Amelia NY Lee and Carl Bagley, ‘School choice with education vouchers: an empirical case study from Hong Kong’ (2017) 26(1) International Studies in Sociology of Education 3.
Bhattarai (n 15) 25.
Ibid.
Verger, Zancajo and Fontdevila (n 17) 9.
Bhattarai (n 15) 26.
Härmä (n29) 139).
Laura Day Ashley and others (2014). EPPE Centre Report 2206 1.
Sarah Cohodes, ‘Charter schools and the achievement gap’ (2018) The Future of Children 1.
Nijs (n 22) 6.
Anomaly (n 5) 114.
Carrasco and Gunter (n27) 78.
Virginia Riel and others, ‘Do magnet and charter schools exacerbate or ameliorate inequality?’ (2018) 12(9) Sociology Compass e12617; N Rooks, Cutting School: The Privatization, Segregation, and the End of Public Education (The New Press 2018); Willem Boterman and others, ‘School segregation in contemporary cities: Socio-spatial dynamics, institutional context and urban outcomes’ (2019) 56(15) Urban Studies 004209801986837.
Helen F Ladd and John D Singleton, ‘The fiscal externalities of charter schools: evidence from North Carolina (2020) 15(1) Education, Finance & Policy 191.
Kosunen (n 21) 75.
JF Mead and SE Eckes How School Privatization Opens the Door for Discrimination (National Education Policy Centre 2018) 2.
Beth Sondel, Kerry Kretchmar and Alissa H Dunn, ‘“Who Do These People Want Teaching Their Children?” White Saviorism, Colorblind Racism, and Anti-Blackness in “No Excuses” Charter Schools’ 2019 Urban Education. Web.
Sonia Exley and Judith Suissa, ‘Private Schools, Choice and the Ethical Environment’ British Journal of Educational Studies (2013) 61(3) 347.

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