The Indian Economy Blog

April 30, 2007

The Indian Education System — Part 1

Filed under: Education — Atanu Dey @ 9:09 pm

The fractal nature of the generalization that education matters holds across time and space. Irrespective of the granularity of analysis, education aids development through the intermediate step of economic growth. At the finest level of detail, an educated individual anywhere in the world is more productive than an uneducated one. At the broadest level of analysis, the modern world is more productive arguably because it is more educated compared to the world that existed before. A cross-sectional study of the world today, or at any earlier time, reveals that the general level of education of the population is a good predictor of the success of the population.

The observed positive correlation between the macroeconomic variables of the level of general education and economic well-being has microeconomic foundations. There are two avenues, private and public. An educated person is simply more likely to make better-informed private choices regarding his or her production and consumption. Aggregated over the lifetime of the individual, that translates into greater individual production and therefore individual income. Individual incomes aggregated over the entire population determine the macroeconomic health of the economy. At the public level, an individual indirectly contributes to greater economic development by making informed choice among various public policies. An educated population is more likely to endorse enlightened public policy.

India’s present economic standing – both in its limited successes and its myriad failures – is to a large extent a reflection of its education system. It takes justifiable pride in the successes of its handful of elite institutions of higher education in turning out world-class super-achievers. But that exceptional success of the few is overshadowed by the dismal failure of the educational system as a whole. At the primary level, the enrollment is around 90 percent but studies have revealed that even after five years of schooling, around 50 percent of the students fail basic reading tests and are unable to perform single-digit subtractions. Ninety percent of Indian children drop out by the time they reach high school.

Of the ten percent who do get post-secondary education in India’s around 300 universities (comprising of 17,000 colleges), their results are disheartening. India produces around two and a half million college graduates, including 400 thousand engineers annually. But the quality is so poor that only a quarter of them are actually employable. Stark statistics reveal the oversupply of raw graduates and the undersupply of employable graduates. Infosys, an IT giant, last year sorted through 1.3 million applicants only to find around two percent were qualified for jobs, according to a recent report in The New Yorker.

That India is not an economic success today is significantly attributable to its failed education system. More importantly, its prospects of even moderate economic success in the future are bleak unless the educational system is urgently fixed. The fatal flaw in the system most likely arises from its near-complete government monopoly control. Practically all aspects of the system suffer from political and bureaucratic meddling. Who can run schools and colleges, what is to be taught, who is going to teach, how much they are to be paid, who is going to learn, how much fees must they be charged, what will be tested and how—every minute detail of the enterprise is rigidly defined and mindlessly enforced. Consequently the system has degenerated to become ineffective, inefficient, and irrelevant.

In this series of brief articles, I present a personal perspective on what is wrong with the Indian educational system, and why. I believe that if we have to fix the system, we have to necessarily first understand the system and what ails it. To the extent that the problem is understood, it is tractable. I hope to present the broad outlines of a solution as well.

[Next in this series: Part 2.]

1 Comment »

  1. [...] [Previous post: Part 1. To be continued.] [...]

    Pingback by The Indian Economy Blog » The Indian Education System — Part 2 — May 28, 2007 @ 11:45 am

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