Does the money invested in education guarantee high student performance and economic development? This is the question we will try to answer as we look at 10 Countries That Spend the Most on Education per Student. Before we present you the list, let’s first examine the nature of the relationship between economy and knowledge on one side and money and knowledge on the other side.
In 2000, the European Council adopted the Lisbon Strategy whose aim was to make EU “the most competitive and dynamic knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion” in the next ten years. Many agree today that the Lisbon Strategy failed to accomplish its goals, mainly because of poor implementation in EU states. At the same time almost no one has questioned the principles upon which it was built, including the idea that economic growth must be knowledge driven. But to what extent can knowledge boost a country’s economy?
It is evident that there’s a direct correlation between a country’s wealth and its spending on education. However, we can ask whether states invest in education because they have money or whether they have money because they invest in education. It’s a classic chicken-or-egg question. Which comes first: money or knowledge? The Work Foundation presents data that indicate knowledge gives countries a competitive advantage. For instance, knowledge-based industries (high- to medium-tech manufacturing, finance, business services, telecommunications, education, health) account for a great share of the Organisation for Economic Co‑operation and Development (OECD) countries’ GDPs. At the same time, the Knowledge Economy (KE) Index, which measures a country’s potential to use knowledge for economic development, shows that a country’s wealth correlates with its KE Index. You can check our list 10 Countries That Spend the Most on Military to see whether states which invest billions of dollars in their militaries also rank high by KE Index.
The second question that relates to a country’s investment in education is whether money guarantees knowledge. According to OECD data, money alone can’t buy a good education system, and among high-income economies, the amount spent on education is less important than how those resources are used. If we measure the successfulness of an educational system by OECD’s PISA test results, we see that students from countries that spend more than $100,000 USD per student from ages 6 to 15 (Luxembourg, Norway, Switzerland and the United States) show similar PISA performance as their peers from countries that spend less than half that amount per student, such as Estonia, Hungary and Poland. Students who excel on PISA tests come from countries that invest most money in teachers specifically — by hiring the best students to work as teachers and offering them higher salaries and greater professional status.
We found the 10 Countries That Spend the Most on Education per Student using OECD’s Education at Glance report which was published last year and which presents data for 2011. On average, OECD countries spend $9,487 USD per student annually from primary through tertiary education, and expenditure per student averages 27 percent of the GDP per capita in OECD countries. The largest share of money is used for funding core services (teachers’ salaries, construction and maintenance of school buildings, teaching materials, books and administration of schools) – 94 percent is spent on core services in primary, secondary and post-secondary non-tertiary education, while in tertiary education 32 percent of funds is allocated to research and development. Besides showing how much money is spent on education, on this list we also present countries’ ranks from the Knowledge Economy Index and PISA results from 2012.