External publications

Sahlgren, G.H. (2015), Real Finnish Lessons: the true story of an education superpower, Centre for Policy Studies

Standard explanations for Finland’s education success include the lack of market- and accountability-based school reform, high teacher trust and status, and a reputable teacher training system. Even pupils’ and teachers’ comparatively low workload have been seen as reasons for its achievements. More recently however, as the country’s performance has begun to slip, these explanations have begun to look increasingly implausible. The findings of this study indicate that Finland’s success to a large extent was due to historical, economic, and cultural factors that have little to do with the country’s education system.

You can download a copy of the full report here.  

Sahlgren, G.H. (2015), 'Selection by Choice' in The Ins and Outs of Selective Secondary Schools, ed. Anastasia de Waal. Civitas.

This paper holds that the most promising mechanism for efficient and equitable allocation of pupils is to maximise consumer choice. Allowing the postcode to decide which schools pupils attend is misguided as it leads to strong residential sorting, and allows parents with means to buy their children a better state-funded education via home ownership – in sharp contrast to the egalitarian aims of proponents of proximity-based schooling. Meanwhile, while selection by ability has a place in education to some extent, the paper argues, it should not be the principal allocation device at primary and lower-secondary level. Little rigorous evidence suggests that school-level ability selection has strong direct effects on achievement. Moreover, to a certain extent, selection within schools could in fact fulfil a function similar to the one that proponents of between-school selection envisage, without the potential negative side effects on competitive incentives. Overall, the maximisation of school choice offers a more compelling alternative since it allows for a combination of (1) better matching between pupils and schools, (2) migration from poorly performing to good schools, and (3) competition, which in turn may generate further improvements across the board. Yet to ensure that choice is maximised in reality rather than merely in theory, it is crucial that policymakers pay closer attention to market design.

You can download a copy of the full report here.  

Sahlgren, G.H. (2014), Incentive to invest? How education affects economic growth, Adam Smith Institute.

Education is often held to be valuable for its own sake. While this may be true, human capital is a key factor in countries’ economic well-being. Improving the knowledge and skills of the workforce is likely to act as a spur to productivity and an improved economic climate. Education may also have important indirect effects on growth. Improved skills and knowledge in the labour force also mean that people are better equipped to pursue innovations and allow existing innovations to spread more rapidly in the economy. Education, therefore, could have positive effects on the economy also in a more dynamic perspective. This report discusses the research regarding the impact of education quantity and quality on economic growth, and provides new quantitative evidence in this respect.

Most research has focused on whether ‘education quantity’, such as a higher average number of years of schooling in the labour force, affects growth rates positively. If this were the case, it would confirm the economic value of the previous Labour government’s policies to increase spending significantly and the implementation of the 2008 Education and Skills Act, which increased the compulsory education age from 16 to 18 in gradual steps. Intriguingly, however, the research on this point is quite mixed – and recent studies actually question whether there is any economic dividend of education quantity at all. Yet there is a fundamental flaw in this research: it does not take into account the quality of education, defined as higher cognitive skills, which is probably more relevant. Indeed, new research consistently shows that international test scores, a better proxy for such skills than average years of schooling, are strongly related to economic output. The impact of increasing test scores by one standard deviation is to raise per-capita growth by about 2 percentage points. This means that by increasing its current performance to the level of top-performers, the UK would gain about 1 percentage point in growth.

My own analysis in the paper, using different data and methodology, displays a similar impact. At the same time, the role of education quantity disappears entirely once holding constant the level of education quality. In other words, to spur economic growth, it may be more relevant to improve the quality of the education system rather than merely focusing on increasing the number of pupils taking higher qualifications.

But how do we improve education quality in a cost-effective manner? The research indicates that input-based policies, focused on simply increasing resources, are not a good solution. Not only do they increase costs, but there also seems to be little relationship between such policies and higher scores in the international surveys. What if, instead, the government were to implement reforms, such as those outlined in the CMRE publication Incentivising excellence, designed to ensure a properly functioning school choice system? The best cross-national research indicates quite significant productivity gains from independent-school competition. According to the author's calculations, if the UK had had an independent-school enrolment rate equivalent to Belgium and the Netherlands (about 70%), its average growth rate in the period 1967-2007 would have been one percentage point higher. Since the research also suggests that independent-school competition drives down education costs quite significantly, it is clearly a cost-effective way to produce a healthier economy. Education quality is more important than quantity in spurring growth and maximising the economic dividend.

The policy implications are quite straightforward: we should focus on improving education quality rather than quantity, and increase the private-school enrolment rate as a means to achieving this end. Making it easier to start new independent schools, and funding them on the same terms as state schools, would therefore be sensible. Promoting school choice has the potential to raise both education and economic output, while keeping costs down; in times of austerity and slow growth, this potential is simply too important to ignore.

You can download a copy of the full report here.

You can view media coverage of the report, published July 2014 here.