Another OECD factoid

Regular readers will know that I am no fan of the OECD cringe, the belief that OECD averages set a standard that Australia should follow.

But uncritical use of OECD statistics is made even worse by misleading use of OECD statistics. That’s what ANU Vice-Chancellor Ian Young – normally one of the better VCs in his public statements – does in this opinion piece in today’s Age.

Young says:

OECD figures show that public spending on tertiary education in Australia is about 0.7 per cent of gross domestic product. Clearly, this will rise as the system is expanded in coming years. However, the spending compares poorly with Denmark at 1.6 per cent, Sweden at 1.4 per cent, Norway at 1.2 per cent and the Netherlands at 1.1 per cent.

On average, public investment in tertiary education in these countries is twice that of Australia.

It is no surprise that these countries have been able to develop high value-added export industries, despite high production costs and high exchange rates. These countries also have high social cohesion.

But Professor Young doesn’t explain why public funding of higher education leads to positive results that private funding does not. So we should look at private spending as well.

And if we average the total tertiary education spending as a proportion of GDP in the OECD’s figures in these countries what number do we get? An average of 1.5%, exactly the same as Australia’s total.

As a proportion of GDP the Nordic countries do have more public spending on higher education than Australia. But this is a factoid devoid of policy significance.