The Washington Post reports on another industry that is feeling the effects of outsourcing: education, and tutoring in particular. In the US, there are millions of dollars available under the No Child Left Behind Act to firms that provide remedial tutoring. And where there’s money, there’s people that want to make more money. And where people want to make more money, they need to lower the costs (click picture for enlargement):

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This morning I attended the launch of the World Bank’s East Asia and Pacific Regional Update. For the first time, the launch came directly from Sydney; previously it was launched in Washington and presented in Australia by videoconferencing. This twice yearly snapshot of economic development in East Asia was presented by Jeff Gutman (WB Vice President for East Asia and the Pacific) and Dr Homi Kharas (WB Chief Economist for East Asia and the Pacific). The title was ‘solid growth, new challenges’ and pretty much covered the message: a lot of optimism, but also some challenges (although I wouldn’t call them new). Here are a few highlights.

Economic growth in East Asia and the Pacific (EAP) remains high. Southeast Asian countries show a rather steady growth of 5 to 6%, while China’s growth slowly decreases but remains high at more than 9%. Japan slowly recovers with a growth of 2.8%.

An interesting observation was the increased regionalization in terms of trade. Exports in East Asia were more than before aimed at other EAP countries. Obviously, the expansion of the Chinese market plays a substantial role in this, but also the economic recovery of Japan.

East Asia is also slowly catching up in terms of patents. The amount of patents in EAP is high for countries like Japan, Singapore, Hong Kong and Korea, even if corrected for income and population. Malaysia and China’s innovation are approximately what could be expected with their level of income. Indonesia, the Philippines and Thailand however, are still underperforming.

One of the challenges ahead was also an important topic in the previous update of November 2005: the avian flu. This problem mainly needs a combination of international and local efforts in order to be contained. Although the economic consequences of an avian flu outbreak could be severe, it “did not keep the World Bank’s Chief Economist awake at night.”

Some extra attention was also given to a more long term threat: global warming. With the rise of China, the CO2 emissions rise accordingly. At the same time, East Asia and the Pacific are very vulnerable to global climate changes, especially since most of their economic activity is in coastal cities.

Interesting quote this morning: “What we worry about most is not having anything to worry about”

The report will soon be available on-line. Audio recordings are available via the University of Sydney Podcasts feed.

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P.V. Indiresan, the former director of the Indian Institute of Technology Madras: “The future of both China and India is at risk, because neither owns the technology it operates; the intellectual property continues to remain in the West. The short answer to this problem is that we should develop our own technology; we should acquire so much intellectual property that the West will be as much dependent on us as we are on them.”

(…)

There has been a real effort to reach out to Asian diasporas in places such as Silicon Valley and Cambridge University. Successful Chinese, Korean, and Indian scientists are being successfully lured back to their home countries to new labs in new research centers stocked with the most advanced equipment. The Shanghai and Beijing municipal governments offer returning technology entrepreneurs tax breaks, subsidized office space and access to government-investment funds.

(…)

Mr. Wen’s (Premier Wen Jiabao of China, Ed) January speech about ‘independent innovation’ was accompanied by commentaries in Science and Technology Daily that quickly pointed out that self-reliance did not signal the abandonment of the ‘open door’ policy and that ‘independent’ did not equate to ‘insular’ or ‘closed’. Domestic firms themselves, moreover, have business strategies that may conflict with nationalist goals.

The very forces of globalization that are encouraging such knowledge transfers, however, are also undermining the abilities of Asian nations to effectively implement technonationalist policies or any top-down development strategy, for that matter. WTO restrictions on import quotas, tariff barriers, and export subsidies have gradually created more open and market-oriented economies. As a result, policy makers have gradually replaced state-led, highly centralized models of technological innovation with a more flexible and open system, increasingly dependent on foreign enterprises. As they have globalized, Asian societies have become less susceptible to top-down direction.

(…)

The twin forces of nationalism and globalization could, however, push in opposite directions. Changes in the security environment are the most likely scenario that would lead policy makers to more forcefully control the free flow of ideas or talent. Already worried about the rise of China’s military power, the U.S. defense and commerce departments are currently considering new regulations limiting the ability of foreign students and researchers to work with information and technology that is export-controlled. Job loss in developed countries, especially among knowledge workers believed to be immune from the vagaries of international competition, could generate a backlash against globalization. A failure of Asian firms to actually work their way up the value chain and begin to control proprietary technology may also cause decision-makers to question whether they can truly break free of dependence on Western technology through integration with the global economy.

It will not be surprising to see innovation and technological challenges arising from countries not historically known for their scientific prowess. While globalization is a part of this story, an important and often overlooked element of this story is the nationalist agenda promoted by Asian states. The world may be flatter, but it is still populated by nation-states seeking to increase their wealth, power, and status.

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Thailand is one of the countries in Southeast Asia that has shown rapid development. Economically it has done very well. It recovered relatively easily from the financial crisis in 1997 and is showing good progress in recovering from the 2004 Boxing Day tsunami. It has liberalised in terms of trade, but it has also become more open politically.But of course there is one thing that you cannot do, and that is to criticise King Bhumibol. The Chronicle reports:

The government of Thailand has blocked access in that country to the Web site of Yale University Press. The move is in response to the site’s publicity material for The King Never Smiles: A Biography of Thailand’s Bhumibol Adulyadej, a book in which the author criticizes the king of Thailand.The government will also ban importation of the biography, which Yale is to publish in July. At various times after an initial blockage of the Web site earlier this month, parts of it were viewable within Thailand. Now access is fully censored, with a notice that reads: This Web site has been blocked by Cyber Inspector, the Ministry of Information and Communications Technology.

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The International Herald Tribune yesterday reported about China’s investments in their universities.

China is focusing on science and technology, areas that reflect the country’s development needs, but also reflect the preferences of an authoritarian system that restricts free speech. The liberal arts often involve critical thinking about politics, economics and history. The government has placed relatively little emphasis on achieving world-class status in these subjects. Yet, many Chinese say – most often indirectly – that the limits on academic debate could hamper efforts to create world-class universities

“Right now, I don’t think any university in China has an atmosphere comparable to the older Western universities – Harvard or Oxford – in terms of freedom of expression,” said Lin Jianhua, the executive vice president of Peking University. “We are trying to give the students a better environment, but in order to do these things we need time. Not 10 years, but maybe one or two generations.”

The question is: can China wait for two generations? Artists and academics are already raising their voices.

But the biggest weakness, many Chinese academics indicated, is the lack of academic freedom. Yang, the former president of Fudan, warned that if the right “atmosphere” was not cultivated, great thinkers from overseas might come to China for a year or two only to leave, frustrated. Gong Ke, a vice president of Tsinghua University, said universities had “the duty to guarantee academic freedom. We have professors who teach here, foreigners, who teach very differently from the Chinese government’s point of view. Some of them really criticize the economic policy of China.”

Li Ao, a well-known Taiwanese writer, called for greater academic freedom and independence from the government in a September speech at Peking University. The next day, after reportedly coming under heavy official pressure, he delivered a far tamer version of the speech at Tsinghua University, where media coverage was tightly controlled. The Chinese government also censors university online bulletin boards and discussion groups, and recently prevented students at Zhongshan University in Guangzhou from conversing freely with visiting elected officials from Hong Kong.

Students here are not encouraged to challenge authority or received wisdom. For some, this helps explain why China has never won a Nobel Prize in any category. What is needed most now, some of China’s best scholars say, are bold, original thinkers.

How long can a highly educated population be censored and restricted by government regulation? And can you have sustainable world-class universities without academic freedom?    

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The Wharton School of Business of the University of Pennsylvania seems to have become very popular in Southeast Asia. The Singapore Management University that was established in 2000 was modeled after the Wharton School.

“Its educational and administrative practices are modeled after American institutions, in particular the Wharton School of the University of Pennsylvania, which has played a central role in SMU’s development.”

Today, the New Straits Times reports that Malaysia is going to be home to a top-class business management institution, modeled on.. the Wharton School of Business. Special Envoy to the Higher Education Ministry Datuk Seri Effendi Norwawi said the business management institution will involve a tie-up with Wharton Business School at the University of Pennsylvania, one of eight Ivy League institutions in the United States. One of the Special Envoy’s chief tasks is to persuade top-notch universities to either set-up branch campuses here or work with other institutions here. Tony, a critical observer of Malaysian higher education, also reports on the issue.

I am currently working on a paper on international isomorphism and the global diffusion of higher education and research policies. I guess this makes a good example.

Update: I just noticed that the New Straits Time also has an interview with Effendi in today’s issue: ‘Roll out the red carpet for foreign students‘

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