Beijing and the reality of international competition”, 22/05/2009, http://www.eastasiaforum.org/2009/05/22/beijing-and-the-reality-of-international-competition/
Makeham’s article serves a useful reminder of some of the differences in the education systems between Australia and China. Obviously, it gas implications for Australians. Equally, however, it has implications for Chinese as well.
I talk only about two points. One is that the somewhat over-emphasis on education levels or the degree of education degrees in China, both individually and both employers. I have heard that there are large back-locks in unemployed graduates in China, some with post-graduate degrees. I begin to wonder whether that represents a waste of resources in China.
It seems to me that it is a paradox of pursuing “higher” education. It is obvious virtuous to learn more through “higher” education as much as possible for an individual, just like savings. However, if everyone in the whole country is doing exactly the same, you will have over supply of highly educated people. The point is it is good from an individual point of view, but aggregately it may cause a problem if every individual is doing the same thing. You might get a country of PhD, or in the Chinese case, post-doctorial, or more interestingly a few generations of post-doctorial for a person, as one’s education credentials to show.
There is no doubt there are benefits of that, everyone is more equally hooted to compete and to earn a living. But at the same time, you have many PhDs unemployed at least at a lowered natural unemployment rate. That, at least in a strict sense, represents a waste of more resources compared to some of the unemployed to have received lower levels of education.
Of course, if the world is perfectly mobile in human resources, then the matter may be different, that is, the paradox in a “closed” economy may disappear in an “open” economy. Those with better education (assuming that translates to better skills) are likely to find better opportunities elsewhere. That was the same point I made regarding Paul Krugman’s paradox of wage cuts in his article of “Falling wage syndrome” (see http://mrlincolns.blogspot.com/2009/05/krugmans-paradox-of-wage-cuts-is-untrue.html).
The second point relates to another potential externality of individual pursuits of better education and learning. If I borrow the production function concept in economics, one knows that you might have diminishing returns at some stage of the production function curve. If I further borrow a concept from economics, the optimal point of an individual’s inputs into education should be at such point where the expected gains from further inputs equal the costs of those inputs. If you further increase inputs into that education production processes, then the return will be lower than its costs. So it may be detrimental to an individual’s utility/wellbeing to pursue too much education.
Now let’s look at an alternative to the Chinese case, the Australian education. Here many people take a quite different attitude. For example, it is often said that one of the main things for primary schools is that children studying there should be made happy. That is obviously more humanitarian as for human beings as a whole. After all, what is the purpose of life? Happy, of course! But this may mean less learning, if we leave aside the possibility of diminishing returns and the so called optimal levels of study efforts/inputs.
So, what is my second point here? The point, if you put the two education systems together, is that we might have a need for a third way, the middle way, an alternative to both the Chinese and the Australian systems. In the middle way system, if one can get the production returns right and one utility (expected) calculation right, then one may not necessarily study as hard as the Chinese in their pursuits of education, but may study a little harder than many Australian students. Many Australians, students in particular, may have a different view regarding to the concept of nerds – a word my daughter often uses to describe me!
A just made a nice revenge, didn’t I? But I only used this forum, not in the debate with my daughter. By the way, she has finished her medicine study at Monash University at the end of last year, even though she says she is not a nerd. For that she will never say; the concept of nerds is too hard to swallow and acceptable for many vogue and young Australians - the future of our current grown-up generations. That was probably a main reason why the Rudd/Swan government has increased the age for aged pension from 65 to 67 in the 2009 budget!
Having finished the two points, I am wondering whether I have caused another paradox in the process! Remember my point? A paradox in one perspective may be solved in a different perspective?