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Marcel Gérard, Economist, Université Catholique de Louvain

Economist Marcel Gérard has studied and lectured all over the world and one of his research interests is the economics of student mobility. He explained to The PIE why student flows within the EU are unbalanced, and what policy makers can do to ensure everyone can benefit from international education.

 

"Enlarge the benefit of Erasmus to non-intellectual activities. Think to an exchange of young citizens, rather than just of students"

 

 

The PIE: In your study, you argue that student mobility within Europe is unbalanced – some countries are experiencing a brain drain, others a brain gain. Which countries are enjoying the best that international education can offer, and which ones are instead losing out?

Marcel Gérard: Yes, the movement is unbalanced – in some countries incoming students from abroad are more numerous than outgoing nationals. And that unbalance raises questions.

But the imbalance itself is not the whole story. For example, the signs are negative for both Belgium and UK. That simply means that those two countries import more foreign students than they export. But the rest of the story differs.

In the UK, foreign students – with the exception of Erasmus exchange students -pay high tuition fees. The UK sells its highly valued higher education and uses the collected revenue to finance its development.

“Unlike the UK, Belgium fails to keep intellectual material that it has enriched”

Britain selects students who will buy its higher education and have a high probability to stay and increase its own stock of skilled human capital, and of taxpayers too.

In contrast Belgium provides higher education, almost for free, to citizens of a neighboring country – France – who failed at the admission exam in medical or paramedical studies in their home country and have a low chance to remain after graduation.

The big issue with the Belgian model is the risk that taxpayers end up subsiding an externality benefitting French students.

Though both England and Belgium are net importers of (relatively) raw intellectual material, at the end of the day, the Anglo-Saxons are typical winners and Belgium is a loser: unlike Britain, Belgium fails to keep intellectual material that it has enriched.

The PIE: Do you see this changing in the future?

MG: Difficult question, which today is Brexit sensitive. What is the future of tuition fees charged to European Union students? If EU legislation prohibiting price discrimination between nationals and EU citizens no longer applies, tuition fees charged to EU citizens could increase up to those charged to overseas students.

The PIE: How can policy makers address this mobility unbalance between EU countries, and ensure that every country can enjoy the benefits that international education has to offer?

MG: The solution, in line with economic efficiency, consists for all EU member states behaving in the best interest of the EU rather than in the best interest of their own country. And that, without centralising the competence “higher education” in the hands of the Commission.

“Who benefits from higher education? The graduates themselves on the one hand. And the countries where they decide to work after graduation.”

This is probably not the only solution but it is one solution for mobile students who are citizens of the EU member states or other developed countries.

Let’s look at it this way. Who benefits from higher education? The graduates themselves on the one hand – they benefit from a better quality of life. And the countries where they decide to work after graduation.

Given that, the student’s country of origin should finance their higher education as well as the cost of living, no matter where the student decides to study within the EU.

The PIE: How would this system work?

MG: In practice the government of the country of origin provides its prospective students with two vouchers, one to finance the cost of studies, the other to finance the cost of living.

Those vouchers can be used at home or abroad provided it is in an institution whose quality is recognised by the issuer of the vouchers, maybe in the framework of agreements of mutual recognition. Minimum amounts on the vouchers are coordinated at EU level, in line with the true cost of studies. For example a voucher for one year of medical studies channels €18,000 from the issuing governments to the university admitting the student.

When, after graduation, the ex-student starts working, they also start to repay the money received during their studies, based on the technique of an income contingent loan, or possibly an implicit income contingent loan or a mix of them.

In the former case the student directly repays the country of origin and benefits of a tax credit in their jurisdiction of residence – that where they work and pay tax. In the latter case, the repayment is directly paid by the jurisdiction of current residence and also credited to the graduate in order to avoid double taxation.

“The solution [is] EU member states to behaving in the best interest of the EU rather than of their own country”

Note that Swiss cantons and Nordic countries apply a system close to that.

The PIE: What do you think about the EU’s project to create a European Education Area, and how you think these changes will impact on the current international education landscape?

MG: I largely agree with the project presented by the Commission; especially the statement that “we should live in a Europe in which learning, studying and doing research is not hampered by borders but where spending time in another Member State to study, learn or work is the norm”.

Importantly, Europeanisation of both studying and working is stressed; in my opinion the EU should support Europeanisation of the various skill levels and not only of the highly skilled. Otherwise you risk separating EU citizens in various social classes based on their respective skill-based mobility, pushing up inequality again.

I also have a concern with “creating a network of universities so that world-class European universities can work seamlessly together across borders”.

I understand that as promoting the creation of one or several “European-wide Ivy League(s)”.

The PIE: What problem would you see in the creation of a “European-wide Ivy League”?

We are not the US or UK with a tradition of elite and non-elite universities.

Who will decide which institution is in the elite and which is not? Is it compatible with mutual recognition by public authorities, or by universities themselves? Do we accept to move towards “leagues” organised by dedicated private institutions? What happens if a member state has no institution ranked in a valuable category? All that deserves further investigation.

“Many EU countries find the roots of their democratic tradition in an equal opportunity right to access higher education”

Also, I think we should rank universities per field of studies or per program of studies – for example like the CEMS network in management sciences. Doing so, a given university may simultaneously offer elite programs subject to be top ranked, and programs dedicated to economic and social development of targeted groups or areas.

And we shouldn’t forget that many EU countries find the roots of their democratic tradition in an equal opportunity right to access higher education. What this means when mobility across countries is at work needs to be further investigated.

Let us keep the freedom to decide of what a good university is, despite the pressure of mobility.

The PIE: You argue that the Erasmus programme is not inclusive. What would be the best strategy to improve the situation?

To enlarge the benefit of Erasmus to non-intellectual activities. Think to an exchange of young citizens, rather than just of students.

Make that supported by refundable financial help in line with the income contingent loan mechanism – although the mechanism needs to be adapted to that social innovation.

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