Current Issues in Comparative Education (CICE) - Volume 22 - Special Issue 2020

Oct 15, 2026

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Paper investigates whether fiscal decentralization can effectively reduce achievement and socioeconomic gaps for a future unified Korea. Using OLS linear regression with cross-country data from 40 OECD and partner countries, it links education finance system design to economic and educational indicators such as GDP per capita, Gini Index, and PISA mathematics scores. Findings distinguish political decentralization from fiscal decentralization and show fiscal decentralization does not always produce efficiency gains. The study proposes deconcentration as the most favorable model for improvement.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages25

Reading Time1 h 3 min

AccessFree to download

Introduction

Fiscal decentralization and education policy context

Research aims and approach

Background

How education systems function in two Koreas

Data analysis and findings

Current Issues in Comparative Education (CICE) Volume 22, Issue 1, Special Issue 2020 Should Unified Korea Choose Fiscal Decentralization for Education? Testing the Decentralization Theory on Education Finance with Cross-country Analysis for Korean Unification Seulgi Kang Teachers College, Columbia University The unification of South Korea and North Korea is a plausible idea yet it requires a comprehensive preparation in advance. As a method to achieve fiscal efficiency in public services, decentralization theory1is consistently applied. However, the current literature and political reality argue that decentralization does not always hold its efficiency. Therefore, this paper focuses on finding an ideal education finance model for post-unification Korea by studying how one country’s academic/economic status is related to their education finance model. This paper conducts the OLS linear regression analysis with 40 OECD and its partner countries’ information on GDP per capita, Gini Index, PISA mathematics score, and the form of education finance system. The main findings of this research are that the political and fiscal decentralization are different ideas, and fiscal decentralization does not always hold its efficiency as the decentralization theory states. Among the types of decentralization, the optimal education finance model for academic and economic improvement is deconcentration – which is a combination of fiscal centralization and political, or administrative, decentralization to empower regional autonomy. Keywords: Decentralization Theory, Fiscal Decentralization, Education Finance, Korean Unification, Economics of Education, Cross-country Analysis Introduction During more than 70 years of Korean peninsula’s division, Korea transformed into two radically different communities – South Korea and North Korea. In 2019, the Gross Domestic Product (GDP) of South Korea was 88 times more than of North Korea (UN Statistics Division, 2020a) . North Korea ranked the lowest in the Democracy Index among 167 countries, while South Korea was listed as 22nd, which was a higher rank than Japan and France (Economist Intelligence Unit, 2016) . Following a‘failing state’of North Korea, a survey to North Korean refugees even showed a dramatic result that 99.2 percent of North Koreans they knew in North Korea wanted unification (Park et al., 2011). Moreover, considering current international conflicts that North Korea faces with world’s leading countries, such as the United States, Japan, and China, as well as with South Korea, unification of Korea is only a matter of time that no one knows when it will happen (Shin, 2013) . Therefore, it is necessary to plan ahead and prepare how essential public services such as education should efficiently function to close not only the achievement gap but also the socioeconomic gap in the era of post-unification with limited resources. 1 Decentralization Theory: a political theory that believes smaller governments are more efficient in providing public services and therefore encourages local autonomy in public services. © 2020, Current Issues in Comparative Education, Teachers College, Columbia University. ALL RIGHTS RESERVED. Current Issues in Comparative Education 22(1), 58-82. Kang As one of the approaches to fiscal efficiency in public services, fiscal decentralization receives significant attention from many nations. Fiscal decentralization is a theory that believes it is always efficient for local governments to provide public services (Oates, 2008) and thus should provide more budget autonomy as well as taxing power to local governments (Welsh and McGinn, 1999) . This idea received attention with the movement of political democratization in the 1980s (Welsh and McGinn, 1999) and has also been applied in education. In fact, many European countries and the United States are pursuing the fiscal decentralization of education, and they believe in its efficiency by allowing a ch

FAQs

What is the paper’s main research question about education finance in unification?

It tests whether fiscal decentralization of education is effective in closing achievement and/or socioeconomic gaps in a post-unification scenario.

How does the paper conduct its empirical analysis?

It runs OLS linear regression using education and economic information from 40 OECD and partner countries, including GDP per capita, Gini Index, PISA math scores, and the education finance system form.

What conclusion does the paper draw about fiscal decentralization’s efficiency?

Political and fiscal decentralization are different ideas, and fiscal decentralization does not always hold the efficiency claimed by decentralization theory.

Oct 15, 2026

Upload by nayy☆