Financing and Political Economy of Higher Education in Lebanon

study sponsored by the Economic Research Forum

The common approach to higher education in the MENA countries appears to be based on three assessments: 1) higher education provision is dominated by the public sector; 2) there is a major financing problem and 3) there is an increasing demand

On each of these points, the Lebanese case is different: 1) the private sector historically dominates the education sector; 2) financing of education in general and higher education in particular is exceptionally abundant and 3) no demographic increase is foreseeable: in 2025, the youth population is expected to decrease by -5 % . But the peculiarities of its history and present situation can be valuable in a comparative approach covering several Arab Countries since they shed light on specific factors, trends and options that might still be latent in other cases.

Lebanon is nevertheless facing severe challenges in the field of human capital formation and mobilization that go far beyond problems of financing:

• In spite of the relative abundance of human and financial resources, growth outcomes are very poor;
• Investment in human capital is probably excessive and is directly related in a circular causality to migration: the severe outflow of skilled migrants that prevents the domestic accumulation of human capital; and while skilled labour is attracted by emigration, unskilled Lebanese labour faces the competition of large numbers of temporary foreign workers;
• The Lebanese Government is unable to delineate a strategic vision for education in general and higher education in particular, resulting in the explosion of private higher education and diminishing means, quality and presence for the only public institution. This paper assesses the adequacy, efficiency and equity of higher education financing in Lebanon in both the public and private sector.

The conclusion discusses different approaches and strategies to remedy the challenges of higher education financing in Lebanon, acknowledging that higher education is far more a response to external stimuli than an exogenous lever or even an autonomous field of action.