Korea Shows How To Fix Education

The Wall Street Journal article "4 Million Dollar Teacher" has finally shown how to fix the American educational system.  Kim Ki-hoon, the $4 million titular rock-star academic, gets paid world-class wages for classroom teaching, but his real money comes from parents paying $2-4 per hour so that their children can watch his instructional videos.

Depending on how you count, Mr. Kim has 30-40 assistants who answer email and extend his market reach.  His business success is a product of two quirks of Korean society:

1. Social Security is limited.  Knowing that children are their only protection against old age poverty, parents pour resources into education to help their children earn as much money as possible.
2. Public schools are so ineffective that parents send their kids to the best-rated after-hours cram schools they can afford.

Cram schools publish test scores and college admissions statistics on big signs.  Student achievement data are broken down by teacher's name.  Parents bid for seats in a top-ranking teacher's classroom.  Cram schools terminate about 10% of their lowest-performing teachers every year.

Teachers respond to the threat of being fired for poor student performance by expelling nonperforming kids from their classes, even if bouncing a student means an immediate pay cut.  Teachers have an economic reason to visit students' homes to make sure parents know what's expected and that they check their kids' work.

Now that's customer service!

Government Meddling in the Market

The $4 million dollar teacher got a substantial boost when populists complained that it was unfair that only rich parents could afford the best cram schools.  Alas, the obvious solution of forcing public schools to improve or subsidizing poor kids' cram school fees through vouchers would have annoyed the teacher's unions.  This was unthinkable, so the government "solved" the problem by strictly limiting the number of hours a child could attend a cram school.

This harsh example of government meddling and restrictions on liberty turned had an accidental stunning result.  The best teachers quickly found that reducing the supply of classroom hours allowed them to boost their fees, just as Adam Smith's laws of supply and demand would predict.  The very best found that "virtual classroom hours" distributed via Internet video boosted their income and didn't count as cram-school hours - an example of imaginative individuals finding a way around government rules.

There was even a beneficial side effect.  Forcibly limiting legal cramming hours ended up helping the poor: parents who couldn't afford a top-ranked instructor's classes can afford his video fees, now that greed and government restrictions compelled instructors to make them available.  Video students don't count against an instructor's success score, so he has every interest in raking in as many of them as can pay.

The results?  Korean high school students rank #2 in the world in STEM achievement, just behind the city-state of Singapore which educates far fewer students than the nation of Korea.

So what do we learn from Korea?

• Student test scores are a reasonable way to tell effective teachers from bad teachers; stating alumna salaries would be even better.
• Involving parents helps, but only if parents care how well their children do in school.
• Parents who pay care about results; parents who don't pay may or may not.

This is effectively how our system works, though less visibly and efficiently.  Wealthy parents send their children to the best private schools they can; effective schools admit only students whose scores will reflect credit on them.  As video instruction becomes more available, more parents will be able to afford supplemental education.

Homeschooling offers an additional legal option in America that's not available in Korea.  Parents who decide to home school via after-hours offline cram schools combined with Internet video and on-line classes won't have to force their kids to sleep through mandatory public school classes as Korean kids must.

Schools work effectively when customers pay because paying customers demand that results be made known.  Schools don't work when government pays because government vested interests will do anything to avoid publishing outcome data, and none of the bureaucrats have an interest in the success of any particular kid.  But given all the video out there, there's no reason any motivated person has to be trapped by government schools' bad education - just go online and get whatever learning you need.