The Efficiency of Educational Production: A Comparison of the Nordic Countries with Other OECD Countries

39 Pages Posted: 16 Oct 2015

See all articles by Peter Bogetoft

Peter Bogetoft

University of Copenhagen - Department of Economics

Eskil Heinesen

Rockwool Foundation Research Unit

Torben Tranaes

Rockwool Foundation Research Unit; Danish National Institute of Social Research (SFI); CESifo (Center for Economic Studies and Ifo Institute); IZA Institute of Labor Economics

Date Written: September 23, 2015

Abstract

Focusing in particular on upper secondary education, this paper examines whether the relatively high level of expenditure on education in the Nordic countries is matched by high output from the educational sector, both in terms of student enrolment and indicators of output quality in the form of graduation/completion rates and expected earnings after completed education. We use Data Envelopment Analysis (DEA) to compare (benchmark) the Nordic countries with a relevant group of rich OECD countries and calculate input efficiency scores for each country. We estimate a wide range of specifications in order to analyse different aspects of efficiency. In purely quantitative models (where inputs and outputs are expenditure and number of students at different levels of the educational system) and in models where graduation or completion rates are included as an indicator of output quality, Finland is the most efficient Nordic country (often fully efficient), whereas Sweden and especially Norway and Denmark are clearly inefficient. However, using PISA test scores as indicators of student input quality in upper secondary education reduces the inefficiencies of these three countries. Also, when expected earnings after completed education are used as an indicator of output quality, all Nordic countries are estimated to be fully efficient (or nearly so).

Keywords: Data Envelopment Analysis, benchmarking, upper secondary education, international comparisons

JEL Classification: C140, C610, H520, I210, I280

Suggested Citation

Bogetoft, Peter and Heinesen, Eskil and Tranaes, Torben, The Efficiency of Educational Production: A Comparison of the Nordic Countries with Other OECD Countries (September 23, 2015). Available at SSRN: https://ssrn.com/abstract=2674558 or http://dx.doi.org/10.2139/ssrn.2674558

Peter Bogetoft

University of Copenhagen - Department of Economics ( email )

Øster Farimagsgade 5
Bygning 26
1353 Copenhagen K.
Denmark

Eskil Heinesen (Contact Author)

Rockwool Foundation Research Unit ( email )

Sølvgade 10, 2.t.v.
Copenhagen K, DK-1307
Denmark

Torben Tranaes

Rockwool Foundation Research Unit ( email )

Sejroegade 11
DK-2100 Copenhagen
Denmark
+45 39 17 38 31 (Phone)

HOME PAGE: http://www.rff.dk/organi/tt.htm

Danish National Institute of Social Research (SFI) ( email )

Herluf Trolles Gade 11
DK-1052 Kopenhagen
Denmark

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

HOME PAGE: http://www.cesifo.de

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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