Education, Poverty and Development in the Philippines: from Quantity to Quality and Beyond

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EDUCATION, POVERTY AND DEVELOPMENT
IN THE PHILIPPINES:
FROM QUANTITY TO QUALITY AND BEYOND

Background paper for the Philippines Poverty Assessment 2004

Jose Garcia Montalvo

Abbreviations and Acronyms

ADBAsian Development Bank
APISAnnual Poverty Incidence Survey
CHEDCommission of Higher Education, Gov. of Philippines.
DepEdDepartment of Education, Gov. of Philippines.
LSFLabor Force Survey
PCERPresidential Commission on Education Reform.
HELMHigher Education and Labor Market Study.
HEIHigher Education Institution.
FIESFamily Income and Expenditure Survey
TESDATechnical Education and Skills Development Authority
NEDANational Economic and Development Authority
PIDSPhilippines Institute for Development Studies
TVETTechnical and Vocational Education and Training
PESSPhilippines Education Sector Study
PPAPrevious Philippines Poverty Assessment (2001)
SUCState University/College
LUCLocal University/College
CSICHED Supervised Institution
VARVector Autorregression
PhPPhilippines’ pesos

TABLE OF CONTENTS

1. Introduction
2. Inputs, outputs and the quality of education
1. International comparisons: education and productivity
2. Basic indicators of education in Philippines: efficiency and effectiveness 1. Primary and secondary education
2. Higher education
3. Inputs, outputs and efficiency: the regional dimension 3. Education and labor market outcomes
4. Regional shocks and workers education
1. Persistence of geographical differences in unemployment rates by skill level. 2. How do workers with different skill levels adjust to shocks? 5. Equity in the access to education
1. Basic expenditure indicators
2. Educational attainment and enrolment
3. Equity in the access to higher education
1. Education expenditure and access
2. Reasons for not being enrolled in education
3. Benefit incidence analysis of public expenditure in education 6. The return to education in Philippines
1. Previous studies on the return to education in Philippines 2. The return to education in Philippines using the APIS 2002. 7. Conclusions

References
Technical note I.

1. INTRODUCTION

Education is a basic factor in economic development. At the microeconomic level education has an important role in social mobility, equity, public health, better opportunities for employment (lower unemployment and higher wages), etc. In the case of the Philippines the previous Poverty Assessment (World Bank 2001) showed clearly that the educational attainment of the head of the household was “the single most important contributor to the observed variation in household welfare.”

However it is also well known that the workers of Philippines have one of the highest levels of education of Asia, specially when considering its level of development. Probably Philippines is the most typical case of what is called the “education puzzle”. Therefore the level of poverty of the Philippines is difficult to be explained by the level of education of their workers.

We could summarize the characteristics of the education system in Philippines as follows:

a. High quantity, in terms of average level of education of the population. b. Low quality of education and small contribution of the quality of education to the growth of TFP. c. High degree of mismatch and overqualification in the labor market. d. Lack of equity in the access to higher education.

The objective of this report is to analyze and propose recommendations for the situation of the educational system of Philippines, specially with respect to the sector of tertiary education, digging into the contribution of education to economic growth in the Philippines as well as the factors that can explain why education is not translated into development. Our methodological approach is to deal analytically with all the...
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