Plus ca change the world bank global education policy and the post-washington consensus

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1 International Studies in Sociology of Education ISSN: (Print) (Online) Journal homepage: Plus ca change the world bank global education policy and the post-washington consensus Xavier Bonal To cite this article: Xavier Bonal (2002) Plus ca change the world bank global education policy and the post-washington consensus, International Studies in Sociology of Education, 12:1, 3-22, DOI: / To link to this article: Published online: 04 Mar Submit your article to this journal Article views: 1373 View related articles Citing articles: 32 View citing articles Full Terms & Conditions of access and use can be found at Download by: [ ] Date: 05 January 2018, At: 05:03

2 International Studies in Sociology of Education, Volume 12, Number 1, 2002 Plus ça change... The World Bank Global Education Policy and the Post-Washington Consensus XAVIER BONAL Autonomous University of Barcelona, Spain ABSTRACT For the last two decades the World Bank (WB) has increased its economic and ideological influence in setting the educational policy agenda of the so-called less developed countries (LDC). The economic crisis of two poor regions of the world in the 1980s (Sub-Saharan Africa and Latin America), the reduction of bilateral forms of educational aid, and the economic and political protagonism of the WB through Structural Adjustment Programmes (SAPs), and loan conditionality have been important factors in locating the WB as a real subject of the educational globalisation process. Since the 1990s, however, the WB hegemony in the economic, social and educational policies for development has been challenged by the evident failure of SAPS as a mechanism for achieving economic growth and the involvement of LDC in the global economy. In the educational field, direct and indirect effects of WB policies have had a negative impact on a number of indicators, while hitting especially the poorest sectors of society. Some authors have observed in this crisis a real challenge for the institution and the reason for the reconstruction of the WB s economic and educational policies. Changes in the role allocated to the state, new forms of attacking poverty or new strategies to set up links with the civil society are seen as clear signs of policy change. This article analyses the current WB educational policy priorities and strategies to assess the extent to which a real policy change can be observed. The article will show that, while there are some movements in the WB agenda, the theory, principles and expected outcomes of the WB education policy remain unaltered. Those observed movements, on the other hand, are interpreted as part of the necessary legitimisation strategies developed by the Bank to deal with its self-attributed role as the institution responsible for global welfare. Introduction Since the beginning of the 1980s the World Bank (WB) influence on education has expanded enormously, both quantitatively and qualitatively. In 3

3 Xavier Bonal the mid-1990s, for example, the WB funding accounted for 25% of the total International Development Assistance to education (Bennell, 1996, p. 235). This fact was the result of an increase in the number and amount of educational loans and the reduction of direct bilateral aid. The share of education loans in the WB budget has changed from less than 4% in 1980 to 10% in 1996, raising to nearly two billion dollars (Bennell & Segerstorm, 1998, p. 271). Currently, the WB finances 164 projects in 82 countries and it is the largest funder of education in the world (Jones 1997; Mundy, 1998; see also the WB website). From the qualitative point of view, the WB influence on the education policies of the Less Developed Countries (LDC) has been characterised by strict loan conditionality. The Structural Adjustment Programmes (SAPs) set up by the WB during the 1980s have unquestionably increased the WB capacity to leverage policy processes and policy goals in many LDC countries. Loan conditionality has changed the relationship between the WB and the borrowing countries, and it has brought about a new culture of understanding policy processes and policy change. The WB develops a particular understanding of educational aid: rather than helping developing countries to achieve context-based educational goals, it defines in advance which policy goals are desirable and determines whether a country can receive financial assistance. These policy conditions have located the WB as the main subject of globalisation of education. Within the ambiguous terrain of assessing what globalisation is and what type of effects it generates on economic, social and political relations (see Hay, 1999), the WB appears to be a real subject embedded of political and economic capacity to generate global changes in educational discourses and practices. Actually, the WB procedures and objectives can be considered an extreme case of globalisation of education: as a multinational institution, the WB has shown an enormous capacity to generate convergence in policy processes and desirable policy goals (though effects may differ depending on national conditions). Interestingly, the extension of loan conditionality as the crucial mechanism for educational lending introduces paradigmatic changes in the form and content of policy making. On the one hand, the WB has shown capacity to introduce new forms of educational governance through a rescaling process of decision making, from the national to the supranational level. In contrast with processes of policy borrowing or policy learning, the imposition mechanism embedded in loan conditionality make political negotiation residual and transfers the power of decision-making to the multinational level. Concerning policy content, on the other hand, the WB has been responsible for producing and delivering a hegemonic model of development, with its associate paradigm of educational development. In accordance to the right policies established by the Washington Consensus institutions (Williamson, 1993), the WB has used all kinds of mechanisms to produce discourses and practices subject to a neoliberal rationality. Policy 4

4 WORLD BANK GLOBAL EDUCATION POLICY papers, research projects, evaluation methods and other mechanisms have worked under the ideological umbrella of the virtues of the market, and the inefficient and corrupted bureaucratic state. Only the market can overcome the obstacles of a bureaucratic state and avoid rent-seeking strategies. Market mechanisms may transform the structural problems of development and generate the necessary conditions to insert developing countries into the global economy. This article tries to analyse a number of implications of the WB as a subject of globalisation, that is, implications that come out from crucial changes in policy content and policy forms. While these implications may be multiple, it is possible to identify changes at two main levels: that of the recipients of WB funding and policy conditionality, and that of the WB itself as a subject of globalisation. Both aspects are obviously related with the WB capacity of structuring a global educational agenda (Dale, 2000), a capacity that deeply transforms educational policy-making and policy reception. Two previous considerations may be pointed out before developing this analysis. First, since what conditions the content of the WB agenda is not the convergence in policy outcomes, but the convergence in policy prescriptions, the implementation of the same policy recipes may produce divergent effects in developing countries. Although these differences cannot be considered in this article, it is important to point out that implications of policy making depend on how policies are recontextualised at the national level (Bonal, 2002). On the other hand, the hegemonic position of the WB in shaping a global educational agenda has consequences for the responsibility the WB earns as an institution in charge of providing the global educational development. This fact, I will argue, has carried a change in the form the WB deals with policy making and the strategies it develops to cope with its global responsibility. This fact is a crucial one to understand priorities and strategies the WB is setting for the twenty-first century and to interpret the meaning of policy changes. In summary, the role of the WB as a globalising institution of education changes not only the global educational agenda, but also the logic of the policy making process. To respond to these goals the article is structured in four sections. The first one identifies the policy conditions in which the WB has developed a paradigm of educational development, in the context of the Washington consensus. Section two classifies direct and indirect effects of WB policies (that is, Structural Adjustment policies) on educational systems of LDC to understand the crisis of a market-led model of educational development and the emergence of some variations in that model. The third section highlights which new strategies and priorities have been introduced in the WB discourses and practices to cope with that crisis. Finally, the last section tries to interpret the meaning of those changes by considering some political conditions that frame current WB policies and practices. 5

5 Xavier Bonal The World Bank under the Washington Consensus The Washington Consensus term was coined by Williamson (1993) in the early 1990s to refer to the economic policy agenda that the IMF, the WB and the US Executive Board were undertaking in Latin America during the 1980s. That agenda included a number of policy recommendations to be followed by developing countries in order to achieve the necessary stabilisation of their economies and institutional reforms that would facilitate the insertion of those countries into the competitive global economy. In broad terms, the Washington Consensus approach recommends that governments should reform their policies by following a number of measures. As Gore argues, these measures should: pursue macro-economic stability by controlling inflation and reducing fiscal deficits; open their economies to the rest of the world through trade and capital account liberalisation; liberalise domestic product and factor markets through privatisation and deregulation (Gore, 2000, pp ). During the 1980s, the Washington Consensus appeared as the paradigm for economic development. It substituted former approaches, especially those based on Keynesian economics and modernisation. Clearly shaped by neoclassical economics, the Washington Consensus pursued economic stabilisation (control of inflation rates, control of balance of payments deficit, public expenditure reduction and so on) through strong adjusting measures. This paradigm made the state almost disappear from the scene of structural change for development. The role of the state was reduced to generate the necessary conditions for a market-led economy (mainly through privatisation and deregulation of markets). Market economics were supposed to make the economy competitive enough to overcome the initial difficulties brought about by adjustment policies and to generate the necessary growth rate to insert developing countries into the new economic order. Multilateral organisations like the International Monetary Fund and the World Bank became global agents for spreading the neo-liberal paradigm of development. During the 1980s, both institutions were able to impose the Washington Consensus agenda to many developing countries through loan conditionality. Their hegemonic position within the international market of financial assistance for development and the extreme dependency of highly indebted countries on international loans, mostly to refund external debt interests, shifted completely the relationship between the Bretton Woods institutions and borrowing countries. Through programmes like Structural Adjustment Facilities, Extended Fund Facilities or Structural Adjustment Loans, both the IMF and the WB were able to impose the neo-liberal paradigm of development to borrowing countries, whatever the previous social and economic conditions were. In Latin America, for instance, the imposition of loan conditionality entailed a dramatic structural policy change, from Import 6

6 WORLD BANK GLOBAL EDUCATION POLICY Substitution Industrialisation (ISI) to export-oriented models of development (Huber, 1996; Gwynne & Kay, 2000). That is, a development model based on state protectionism of strategic industries was forced to disappear and be substituted by a free market model in which non-subsidised industries should openly compete in the global market of free trade. A number of empirical studies have shown that the programmes extended by the WB and the IMF were associated with increased poverty, increased inequality of income and slow economic growth (Stewart, 1995; Cornia et al, 1997; Chossudovsky, 1998). The failure of Structural Adjustment Programmes (SAPs) as appropriate recipes for development is illustrated by a simple fact: since the mid-1980s, third world countries have become net capital exporters to northern countries (Chossudovsky, 1998, p. 51). Debt repayments account for more than capital transfers to the third world (counted as loans, direct foreign investment and development assistance).[1] Of course, not only International Financial Institutions (IFIs) are responsible for this failure. Actually, it is always difficult to provide an accurate evaluation of the reasons why certain programmes were wrongly designed or implemented. National problems (governmental corruption, bureaucratic inefficiency and so on) might have added difficulties to the implementation of IFI s agenda. Whatever the concrete causes, the global result was the economic and social devastation of third world countries during the 1980s (the lost decade, in Latin America). The impact of SAPs in education was equally negative. Somewhat paradoxically, policy recipes based on a rationale of infrastructure and human capital investments for innovation and development produced the exact contrary effect. It is towards the impact of SAPs on some educational indicators that we now turn. Structural Adjustment Programmes and their Impact on Education: direct and indirect effects A number of studies about the impact of SAPs in education have been carried out (Reimers & Tiburcio, 1993; Samoff, 1994; Carnoy & Torres, 1994; Ilon, 1994; Carnoy, 1995; Reimers, 1997, 2000). Their results mostly point out a number of negative effects that SAPs have had on several educational indicators: the falling of educational expenditure as a percentage of the GNP, reduction of per capita expenditure, increase in educational absenteeism and school failure, a contraction in access to primary and secondary education, and so on. Notwithstanding the evidence of these results, it is important to point out the methodological difficulties of evaluating the impact of SAPs in education. On the one hand, it is difficult to isolate the impact of SAPs factors from the external conditions in which they are implemented. On the other hand, there are a number of causality chains that can take different forms in different contexts and have therefore different effects (Samoff, 1994, p. 15). These aspects must be taken into account 7

7 Xavier Bonal when considering the effects described in this section. The aim here is only to provide an overview of some of the key effects that WB policies have had on some educational indicators. A distinction between direct and indirect effects helps to evaluate the consequences of SAPs in education. Direct effects refer to those aspects of educational change that are the result of the conditions imposed by the WB sectoral loans or macro-economic prescriptions (a reduction in public expenditure in education, for instance). Indirect effects, on the other hand, can be understood as consequences derived from social, political and economic conditions in which SAPs take place that indirectly produce changes in some educational indicators (for example, the rise of opportunity costs as a consequence of more poverty). Indirect effects can be as much, or even more, significant as direct effects (Dale, 1999). Furthermore, by considering indirect effects we can identify some non-intended consequences of austerity programmes on education, though non-necessarily unpredictable. For example, the rise of poverty in those countries that followed SAPs should not be considered a planned and deliberate result by multilateral organisations as some authors do (Biel, 2000). Rather, it should be understood as a non-desired result (although certainly a predictable one), of developing a specific economic policy. Direct Effects of SAPs From educational planning to political marketing. Morrow & Torres (2000, p. 44) rightly state that in developing countries the major dependency on multinational funding entails a change in political rationality. Political marketing to get access to international funds becomes the main objective of recipient countries, changes the whole rationality of priorities and strategies for education and limits the number of options available. SAPs do not only reduce the national autonomy to set strategies. By being almost the unique source of funding they have the power to restrict the scope of policy choices of developing countries. The reduction of educational expenditure and its effects on public education. This is probably one of the clearest and most dramatic direct effect of SAPs programmes on LDC. During the 1980s, those countries that followed SAPs reduced public expenditure in education more than those that did not (Reimers & Tiburcio, 1993; Reimers, 1997). Even the countries that were able to maintain the relative effort of public expenditure as a percentage of GNP, the economic recession and the rise of school population had a negative impact on per pupil expenditure. This contraction meant the impossibility to expand the public educational system, especially in Latin America and sub-saharan Africa. Education access fell down in all educational levels. Transition to secondary education was particularly dramatic: until 1990 it did not achieve the same rates of 1970 (Reimers & Tiburcio, 1993). The reduction of public expenditure had also consequences 8

8 WORLD BANK GLOBAL EDUCATION POLICY on educational quality. The reduction of teacher salaries obliged most teachers to search for complementary jobs to survive. On the other hand, quality was also affected by the increase in the pupils per unit ratio.[2] Finally, the reduction of educational budget severally affected capital expenditures. The effects of prioritising basic education. Since the 1980s, the WB relies heavily on rates of return to education as the only rationale for educational investment[3] (World Bank, 1995; Bennell, 1996). Since then, financing basic education has become the first priority, at the cost of technical and even higher education. This political priority gave credibility to the Bank in two aspects: first, it relied on apparently irrefutable arguments legitimated by the dominant paradigm of economics of education;[4] secondly, it made the Bank appear as an institution concerned with the struggle against poverty and educational opportunities. However, the rates-of-return rationale has also legitimated other priorities in policy making. They have justified arguments in favour of more user participation in the financing of post-basic education and have opened the door for an increase of the private sector in educational supply. Enrolments in secondary and tertiary education fell in many countries and the rise of private costs increased educational inequalities in the access to post-compulsory education. The effects of privatisation and quasi-market reforms. The WB has encouraged a major presence of the private sector in developing countries as a means of expanding educational opportunities.[5] Privatisation is defended, on the one hand, as a means of compensating for the contraction of public expenditure. On the other hand, privatisation relies on a supposed better effectiveness of private schools (Lockheed & Jiménez, 1996) although other authors (Carnoy & McEwan, 1997; McEwan, 2000) have questioned this evidence. Finally, given the importance of higher education to invest in human capital, private education has been especially encouraged to expand enrolments in that level. Privatisation has been usually accompanied by the introduction of quasi-market reforms, mainly free school choice policies and formula funding. Privatisation and more users-pay have changed dramatically the balance between the public and the private sector in some countries and have increased school segregation. Chile is a good case in point, where student enrolment in private education changed from 20% in 1980 to 43% in 1996 after school choice and privatisation policies introduced by Pinochet s government. Privatisation has carried a clear process of school segregation, especially after a reform introduced in 1993, which allowed subsidised private schools to charge extra fees to families (Carnoy & McEwan, 1997). The effects of decentralisation and school autonomy. The WB discourse emphasises decentralisation as one of the key mechanisms to achieve an efficient education system. It is argued that decentralisation improves the quality of education: more school autonomy for schools and local authorities 9

9 Xavier Bonal approaches decision-making and management to citizens, who in a decentralised system can have the power to monitor their institutions. At the same time, decentralisation and school autonomy, in a more market-type education system, are the necessary inputs to generate school competitiveness. The private school mode of organisation is taken as the reference model to be followed by public schools. It is assumed that if public schools get the same level of autonomy as private schools and school competitiveness is boosted through quasi-market policies, the quality of education and the school cost-effectiveness will improve substantially. At present, there is no evidence that decentralisation policies have improved the quality of education. Some have pointed out that the real objectives of most decentralisation reforms are not related with the quality of education. Rather, decentralisation is undertaken as a means of reducing financial and political responsibility to the state level (Carnoy, 1999, p. 54). During the 1980s, decentralisation and marketisation educational reforms in Latin America have increased school inequality and geographic inequalities. The effects of educational evaluation. Most of international organisations with a direct interest in education have developed research on educational indicators and have disseminated their models of evaluation (OECD, UNESCO, EU and WB). One of the real effects that globalisation is having on education is the development of systems of evaluation to make education internationally comparable and quality of education accountable (Carnoy 1999, p. 64). It is also the case, however, that national governments have used education evaluation as a political strategy to show differences between public and private schools (as in Chile), and to supervise decentralisation policies. The WB has also been responsible for developing educational evaluation and standardisation systems, which have been strategically used to identify the poor quality of teaching as one of the main obstacles to school effectiveness and school quality. Political discourses and educational indicators have been used to criticise teachers resistance to change and innovation, and to legitimate political strategies of teachers supervision and teachers salary reductions. Teachers working conditions in poor countries have been devastated by these policies. Indirect Effects The model of development discursively defended by the institutions of the Washington Consensus locates education as one of the key mechanisms to train human capital and to insert poor countries into the knowledge-driven global economy. As it has been argued, there is no evidence that the educational reforms encouraged by the WB have generated the necessary conditions for educational development, while there is evidence that educational access and equality of educational opportunities have been seriously damaged by these policies. It is noteworthy, however, that the main effects on educational development do not have to come necessarily from 10

10 WORLD BANK GLOBAL EDUCATION POLICY educational reforms. Economic policies and other institutional reforms, much more present in loan conditionality[6] can have indirect effects on education that may have crucial and even contradictory effects with those of direct educational reforms. In this section I will analyse three indirect effects of adjustment policies on education: the effects of adjustment on the opportunity costs of education; the effects of economic liberalisation on the structure of educational supply and demand; and the impact of neoliberal policies on the changing patterns of educational demand of the middle classes. The rise of opportunity costs. During the 1980s, severe macro-economic adjustment measures dictated by IFIs increased the population living in poverty in the LDC. A rationale of necessary adjustment before a possible take off was behind policies that had the predictable effect of increasing poverty. The fall of per capita income increased subsequently the opportunity costs of schooling, especially among the poorest in rural areas. On the other hand, the rise of other costs of education (school fees, textbooks, uniforms, school transport) stimulated by policies of more household financing for education, increased the private costs of education and prevented low income families from investing in education. In Costa Rica, for instance, private expenditure in secondary education changed from 30 to 60% of the direct costs in one decade (Carnoy & Torres, 1994, p. 81). For some families, the costs of enrolling the child in the education system may carry a 30% of the family income (Reimers, 1997). In the rates of return calculations, the WB tends to undermine the opportunity costs of education and therefore to overestimate the social benefits of basic education (Bennell, 1996). It can be the case, therefore, that the WB supports its policy recommendations on at least questionable empirical evidence. Economic liberalisation, state strategy and the effects on education. Among the economic reforms fixed by international financial institutions for LDC, liberalisation measures have a central protagonism. Removing taxes for the circulation of capital flows and exchange rates liberalisation have been included as key aspects of economic reforms. In these circumstances, states have been forced to open their borders to attract foreign capital and to generate the right regulatory conditions to keep capital in place. Most countries have introduced labour market reforms to facilitate cheap labour and the deregulation of the labour contract. States have assisted the entrepreneurial classes in collective bargaining and have reduced the minimum wage below the subsistence level. These policies have at least two effects in education. On the one hand, the fall of real salaries for the less qualified jobs reduces the rates of return to basic levels of education and even more prevents the poorest families from participating in basic education. On the other hand, the fiscal crisis of the state and the adjustment measures of controlling the public deficit imposed by IFIs undermine the long-term strategy of investing in human capital to develop the national economy. That 11

11 Xavier Bonal means that the state cannot attempt to attract foreign capital based on specific educational qualifications and cannot escape from maintaining low wage policies. Educational expansion at higher levels can only be achieved through the private sector, which provides opportunities for education as a business for private entrepreneurs. Finally, this vicious circle between economic liberalism and education increases the problem of the brain drain in the context of a growing international division of labour. In summary, as Stewart (1996) points out, if we want to assess the impact of economic liberalism in educational as a strategy for development it is important to consider the starting situation of the national economy. Only those countries with a good level of human capital are able to attract foreign capital on the basis of the qualifications of the population and enter into a virtuous circle of economic and educational development (as happened in some East Asian economies during the 1980s). Economic neoliberalism and the middle classes: changing patterns of educational demand. The circumstances described above have also had consequences for the educational strategies developed by the middle classes in LDC. The middle classes have been severally damaged by adjustment policies and economic recession, but their educational strategies differ from those of the poorest sectors of society. The polarisation of wages caused by economic liberalisation facilitates the development of educational investment strategies among the middle classes. In order to escape from proletarisation, middle classes tend to avoid the public system, and invest in private and high quality secondary education. This pattern of educational demand stimulates the expansion of this sector at the non-university level, which in turn increases educational inequalities. In some countries (like Brazil), the demand for secondary private education is used as a strategy to get access to the best public universities (Carnoy, 1999). Thus, those that can invest heavily in private secondary education have more chance to enter a highly prestigious public higher education institution (with numerus clausus), while those that cannot have to enter a private institution, more expensive and of less quality than the public ones. Finally, these patterns of educational demand reduce the willingness of the middle classes to finance through their taxes the public education system, a low quality service scarcely consumed by them (Ilon, 1994, p. 102). At the same time, the middle classes try to influence other policies more favourable to them (like tax exemptions associated to private educational expenditure). The Post-Washington Consensus: a new agenda for education? In the late 1980s the Washington Consensus was experiencing difficulties in face of a number of criticisms. The rise of poverty and subsequent complaints about structural adjustment effects led to demands for adjustment with a human face (Ilon, 1996). Simultaneously, the success of East Asian economies opened claims for a different role of the state in 12

12 WORLD BANK GLOBAL EDUCATION POLICY development (Fine, 2001, p. 139). In Latin America, ECLAC s neostructuralism tried to establish a Southern Consensus to challenge the neoliberal assumptions of the Washington Consensus and argued for a context-based strategy of industrialisation to ensure the integration of national economies into the global economy (Gore, 2000, p. 796). The work of Joe Stilglitz as Chief Economist to the WB in the late 1990s, and a number of lectures of Amartya Sen at the WB, opened a new debate about development and generated conditions for a Post-Washington Consensus. Fine (2001, p. 139) describes the features of the Post-Washington Consensus as follows: First, it is sharply critical of the Washington Consensus and seeks an alternative in which state intervention is greater in depth and breadth. Second, it rejects the analytical agenda of state versus market, arguing that the two are complements and can work together and not against one another. Third, if less explicit, it poses an alternative agenda for development economics and policy debate, seeking to establish the appropriate role of the state in view of market imperfections. Fourth, it also brings the social back into the analysis as the means of addressing, and potentially correcting, market imperfections rather than simply creating them as for the Washington Consensus for which the world would be a better place if it were made more and more, if not completely, like the market. What type of consequences would such a new consensus bring into education policy debates and practices? Interestingly enough, and as Fine argues, in policy terms the Post-Washington Consensus does not differ radically from the Washington Consensus. State interventionism is still restricted to market imperfections, which are now recognised, but this is different from the Keynesian state model of development. The state is still seen as captured by rent-seeking agents, a major obstacle for bringing structural change. Thus, it is questionable that the Post-Washington Consensus brings a new agenda for policy development and educational development. A review of some education policy papers published in the late 1990s (World Bank, 1999a,b) shows new objectives and commitments for education; social aspects have clearly more relevance than they had in previous statements. However, it is questionable the extent to which new objectives and commitments for education challenge the basic principles of economics of education that sustain the rationale of WB education policy. Basic features of WB education policy, like the rates of return rationale for educational investments, the importance of private education, and the marginalisation of vocational education and training remain unaltered. This art of paradigm maintenance (Wade, 1996) is significant to understand the scope and limits of new education initiatives. If the contextual framework does not change, it is questionable that new policy initiatives will result in substantial changes in policy practices. The following paragraphs address this analysis by 13

13 Xavier Bonal considering two central aspects of WB policies and their educational consequences in the late 1990s: attacking poverty and building partnership for development. Strategies Against Poverty From the late 1990s, building strategies against poverty has become the new mission of the WB. The World Development Report 2000/2001 broadly showed this commitment and also made explicit how the Bank s conception of poverty changed. The incorporation of the Human Development Index, which measures nutritional status, educational attainment and health status, shows a difference from the conventional understanding of poverty as per capita income (Pender, 2001, p. 406). In education, the WB has been decisively involved in the Education for All programme launched by UNESCO and UNICEF since the beginning of the 1990s, showing a clear commitment to the goal of universal schooling. Although there is no discussion about the potential policy implications of such commitment, it is less clear that the Bank is changing loan conditionality based on this priority. Actually, strategies against poverty do not necessarily entail a paradigmatic change in WB education policy. On the one hand, attacking poverty can be understood as a state strategy to account for a market imperfection: to compensate for the failure of the trickle down effect of the market, the state uses emergency services to attend the most damaged sectors of society see Robertson & Dale (2002) on the use of local states of emergency by the neoliberal state. Poor sectors of society become target groups in a state logic of intervention that manages risk and uncertainty. On the other hand, strategies against poverty do not necessarily entail a redistributive economic and social policy. A policy to ensure basic needs for the poorest can be addressed without locating redistribution as the main priority for education policy, nor changing the trickle down logic of the market as the means to ensure redistribution. Actually, in the WB education policy discourses redistribution as a prior objective only appears when dealing with the finance of post-compulsory education, a discourse that provides the rationale to legitimate more user-pay share and the concentration of public spending in basic education. The WB policy papers never consider progressive or regressive redistributive effects of expanding the private sector of education. Building Partnership Partnership and social capital have become key concepts to shape a new WB policy style. Since the late 1990s, they have been introduced as symbols of a new policy management that tries to change the authoritarian character that shaped SAPs, and provides an image of dialogue and democratisation in the process of exploring, designing and implementing policies.[7] One main 14

14 WORLD BANK GLOBAL EDUCATION POLICY consequence related to this change has been the call from the WB to public bodies, individuals and, overall, NGOs to be involved in the process of setting priorities and strategies for development. The WB asserts now that listening to the voice of those most affected by the implementation of its policies is a common practice before designing policies. It is also beginning to consult with social movements and other organisations from recipient countries and from the international community. The notion of building social capital acquires a crucial meaning for community involvement, partnership and context-based policy strategies. In addition, by developing partnership the WB has attempted to reduce the growing criticisms coming from different sectors (global and local social movements, critical academics and others) about its authoritarian policy style and the lack of context-based negotiation with the local community. Despite the WB new discourse, the real impact of partnership on the process of setting policy strategies is less clear. First, although NGOs are usually called to cooperate with the Bank, the Bank maintains the last word on the best practice to implement. After all it is only the Bank that provides the financial resources to carry out development projects. Secondly, building partnership is a type of policy discourse that fits perfectly within the WB paradigm for development. Partnership can be easily linked to decentralisation processes, devolution strategies and the participation of the private sector in service provision. WB strategies on Vocational Education and Training (VET) are a good example of how the notion of partnership can be used to transfer responsibility from the state sector to different agents (local authorities, entrepreneurs and so on) as main providers of VET (Bennell & Segerstorm, 1998). Finally, social capital becomes a notion through which economics colonises other social sciences. As Fine argues: The economics principles underlying the post-washington Consensus (market imperfections, particularly those based on imperfect and assimetric information) are being applied to the non-economic or to less traditional areas of application, such as the role of civil society or the conditions conducive to the emergence of a developmental state. In this respect, in part through social capital, economists are gaining leverage over the subject matter of other disciplines whilst their own economic principles remain unchallenged. (Fine, 2001, 155) Within the WB, the use of social capital has allowed economists to get involved in the non-economics terrain, but both the economy and the state are being excluded from the WB s treatment of social capital (Fine, 2001, p. 169). In summary, neo-classical economics remains the unaltered paradigm that shapes WB policy-making. Indeed, the colonisation process of other social sciences by economics under the post-washington Consensus may expand formal economic models as a means of analysing non-economic social relations and, through this, reinforce the existing paradigm of development. 15

15 Xavier Bonal Concluding Remarks: the limits of change There is growing evidence that, since the late 1990s, the WB has introduced some changes in its discourse. A former aggressive neoliberal model of development is being substituted by a new strategy that is more socially sensitive and less based on strict neo-classical economics. Indeed, the failure of structural adjustment programmes has produced a change in the language of economic development. Under James Wolfensohn s Presidency the Bank has coined the notion of Comprehensive Development Framework (Pender, 2001) to symbolise a shift in its priorities and strategies. Struggle against poverty, building social capital or the image of the Knowledge Bank are some of the Bank s responses to face new challenges in development issues. It is obviously too early to provide an accurate evaluation of the real or rhetorical character of these changes. Nevertheless, there are at least three questions to be considered to understand the forces and limits of policy change. First, since the mid-1990s the WB has had to deal with a new political agenda, something highly related to its growing role as the institution responsible for global welfare. In other words, it seems that the WB has now to deal more and more with legitimation problems. The concentration of decision-making capacity, the authoritarian features of its policies, and the task of denouncement and criticism carried out by global social movements, have put the Bank under the scrutiny of global civil society. Since Seattle, IFIs cannot overlook that more and more institutions and social movements are monitoring its policies and practices (Mohan et al, 2000). While it is difficult to assess the extent to which new legitimation problems can shape the WB agenda, there is evidence that global supervision of IFI s activities matters, as the suspension of WB s Convention in Barcelona in June 2001 illustrates. An increasing need to legitimate WB s policies may be sufficient reason for policy change, but it is also the case that discursive changes might be used rhetorically and symbolically to produce a new image of the Bank. Discourses may change the image while real practices remain unaltered. Secondly, as the previous section has shown, the post-washington Consensus does not entail a paradigmatic change. Wade s (1996) analysis of the capacity of the Bank to remain attached to neo-classical economics may explain this art of paradigm maintenance. As Wade argues, the WB s interest to keep a neoliberal paradigm for economic development is not only related to the scientific and ideological conviction of the Board of Directors. There are very material interests to maintain a market-led understanding of development, especially if the Bank aims to ensure an hegemonic position within the international market of credit. Actually, the Japanese challenge to the WB economic policy after the East Asian Miracle showed the Bank s resistance to change: a recognition of selective state interventionism would make WB credit less attractive, especially in East and Southeast Asia. As Wade (1996, p. 15) argues: 16

16 WORLD BANK GLOBAL EDUCATION POLICY If the Bank were to embrace the interventionist role of the state wanted by the Japanese government it would, in the eyes of its managers, risk its ability to borrow at the best rates on word money markets and so face lower demand for its now more expensive funds. It would also risk its second most valuable asset after its government guarantees its reputation as a country-rating agency, a kind of international Standard and Poors that signals private investors where they should put their money. Why would such dire consequences follow? Because the Banks ability to borrow at the best rates and to act as a country-rating agency depends on its reputation among financial capitalists, which in turn depends on its manifest commitment to their version of sound public policies. In addition, the US historical control of the Bank,[8] the need to provide a free trade environment for US exports, the search for an image of political impartiality through an economic rationality that excludes intensive state participation, and the aim to maintain an hegemonic position in the policy development debates and practices are other factors that can explain the Bank s resistance to introduce substantial changes and the reaction of alarm to the pro-interventionist views. Finally, another group of reasons to understand the limits to change comes from the lack of effective accountability systems of IFIs. Woods analysis of this aspect points out several reasons why the WB and the IMF are not adequately accountable (Woods, 2001). On the one hand, there are problems related to the structure of representation. The representatives of governments the Board of Governors do not develop a real supervision of the Executive Directors, which have the dual role of managing the organisation and representing a country or group of countries. Furthermore, the Board does not adequately represent all members and it particularly fails to represent the countries with the most intensive relationship with the institutions, like African countries. Actually, the voting power of IFIs is absolutely unbalanced. Since the creation of the WB and the IMF, shareholders were fixed depending on their position in the world economy. Northern countries especially the US are largely over-represented, while borrowing countries are clearly under-represented (Woods, 2001, pp ). On the other hand, deficiencies in the internal supervision processes actually make IFIs unaccountable. Many Executive Directors are in the job only for a short time and their decisions may be biased to defend their own country's interests. In addition, there is rarely internal disagreement between the staff and management of the Bank and the Executive Board. Crucial decisions are taken prior to Board meetings and policy debates are very rare. Appointment systems for the head of the organisation (at the WB and the IMF) are not at all transparent. Finally, all these problems have been magnified by the expansion of the activities of IFIs. Their capacity to shape international policy-making has grown enormously while their accountability simply has 17

17 Xavier Bonal not: The IMF or the WB were neither created nor structured to undertake or to be accountable for such far-reaching activities (Woods, 2001, p. 89). The lack of accountability reduces formal and real pressures on the decision-making structure and the everyday practices of an institution like the WB. That is, while it is true that the Bank is facing more legitimation problems caused by a greater visibility of its activities and a close supervision of worldwatch social movements, it is also the case that adequate systems of accountability are still missing, something that provides an extraordinary discretionality to the WB to maintain a certain policy orientation. The three aspects highlighted in this section describe the context in which the WB is undertaking policy changes. While it is premature to assess the extent to which new programmes and projects entail a real change within the global educational and social policy fields, the above arguments do not call for great optimism. Notes [1] The transfer from Third World to First World countries is four times superior to the Marshall Plan to reconstruct Europe after World War II. In the mid-1980s total net transfer to the First World accounted for 250 billion dollars (Hoogvelt, 2001, p. 180). [2] Interestingly enough, the WB invested heavily in producing and publishing research results to show the weak relationship between school effectiveness and pupil per unit ratio in a clear attempt to facilitate classroom concentration. [3] The rates of return rationale for establishing investment priorities was especially undertaken by the work of Psacharopoulos. This method fitted perfectly with the educational policy objectives of the WB during the Aklilu Habte mandate as director of the Department of Education (see Jones, 1992, p. 141 ff.) [4] The consistence of the rates of return analysis is only apparent. There are many practical problems (missing data and especially, the over-estimation of benefit rates as a consequence of excluding significant variables in the calculation). See Bennell (1996) for a critique on the use and abuse of rates of return. [5] In 1999 the International Finance Corporation, member of the World Bank group, organised a conference on Investment Opportunities in Private Education in Developing Countries. This conference included papers to scientifically legitimate the virtues of private education and a call for governments and private investors to boost the private sector expansion. [6] Reimers (1997, p. 14) underlines the fact that, until 1988, only 3% of the conditions to get access to a WB loan were referred to social policy reforms (including education and health). [7] Since 1998, a specific website about social capital illustrates the importance of social capital in the WB policy discourse. [8] Wade provides evidence about great influence of the US on shaping WB policies: the fact that the President has always been an American, the over-representation of Americans with a strong neo-classical economic orientation among the specialised staff of the Bank relative to the US s shareholding, the greatest share of votes among its 18

18 WORLD BANK GLOBAL EDUCATION POLICY members, the exclusion of Japanese initiatives for policy change are some of the factors identified by Wade. Correspondence Xavier Bonal, Department of Sociology, Autonomous University of Barcelona, Bellaterra, Barcelona, Spain References Bennell, P. (1996) Using and Abusing Rates of Return, International Journal of Educational Development, 16, pp Bennell, P. & Segerstrom, J. (1998) Vocational Education and Training in Developing Countries: has the World Bank got it right? International Journal of Educational Development, 18, pp Biel, R. (2000) The New Imperialism. Crisis and Contradictions in North/South Relations. London: Zed Books. Bonal, X. (2002) The Neoliberal Educational Agenda and the Legitimation Crisis: old and new state strategies, British Journal of Sociology of Education (forthcoming). Carnoy, M. (1995) Structural Adjustment and the Changing Face of Education, International Labour Review, 134, pp Carnoy, M. (1999) Globalization and Educational Reform: what planners need to know. Paris: Unesco. Carnoy, M. & McEwan, P. (1997) Public Investments or Private Schools? A Reconstruction of Educational Improvements in Chile. Stanford: Stanford University School of Education. Carnoy, M. & Torres, C.A. (1994) Educational Change and Structural Adjustment: a case study of Costa Rica, in J. Samoff (Ed.) Coping with Crisis. Austerity, Adjustment and Human Resources. London: Cassell. Chossudovsky, M. (1998) The Globalisation of Poverty. Impacts of IMF and World Bank Reforms. London: Zed Books. Cornia, G., Jolly, R. & Stewart, F. (1997) Adjustment with a Human Face, Vol. 1. Oxford: Clarendon Press. Dale, R. (2000) Globalisation and Education: demonstrating a common world education culture or locating a globally structured educational agenda? Educational Theory, 50, pp Dale, R. (1999) Specifying Globalisation Effects on National Policy: focus on the Mechanisms, Journal of Education Policy, 14, pp Fine, B. (2001) Social Capital Versus Social Theory. London: Routledge. Gore, C. (2000) The Rise and Fall of the Washington Consensus as a Paradigm for Developing Countries, World Development, 28, pp Gwynne, R. & Kay, C. (2000) Views from the Periphery: futures of neoliberalism in Latin America, Third World Quarterly, 21, pp Hay, C. (1999) What Place for Ideas in the Structure-agency Debate? Globalisation as a Process without a Subject, paper presented at the Annual Conference of the British International Studies Association, University of Manchester, December