Neoliberalism and the philosophy of economics

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CHAPTER 3 THE RELEVANCE AND IMPACT OF NEOLIBERALISM TO HIGHER EDUCATION

INTRODUCTION

The previous chapter discussed the development of neoliberal theory as well as other theories which paved the way for its development. This chapter focuses on the relevance of neoliberalism to higher education, employability of graduates, human capital, and related studies as illustrated in Figure 2. Apart from that discussion on neoliberalism and undergraduate economics textbooks a map is also given. Figure 2 is a conceptual map given to serve as a signpost of the chapter. It gives the reader the direction of the chapter and is intended to keep the researcher focused.

CURRICULUM TRANSFORMATION IN SOUTH AFRICAN HIGHER LEARNING INSTITUTIONS

It is of great importance to look at policy development in South African Higher Education as a way of understanding the contextual background of the transformation of higher education in South Africa. Education has gone through a lot of transformation in South African. Transformation in Higher Education is not unique; a number of nations have gone through the same process. Some of these nations include Britain, the United States of America, Canada, New Zealand, China, Mexico, Latin America and Ethiopia, just to name a few. The main reason behind this transformation is to be competitive in the global markets. Technology is changing, and the world is now a global village thus nations constantly keep transforming in order to be at par with other nations. The next section illustrates the educational policy development which took place in South Africa.
It must be noted that the study did not focus on the changes that took place in higher education or policy but it specifically focused on the development of neoliberalism and its impact on undergraduate economics curriculum. The researcher avoided traversing the same ground. Changes which took place in higher education are given as background knowledge to the study so that the development of neoliberalism will be understood better. The background knowledge of the development of neoliberalism is first traced from the White Paper. There are a number of purposes of higher education listed in the White Paper, but for the purpose of this study four are singled out, because they are relevant to the study.
Four purposes of higher education as listed in the White Paper:
• To meet the learning needs and aspirations of individuals through the development of their intellectual abilities and aptitudes throughout their lives (lifelong learning should be emphasised);
• To address the development needs of society and provide the labour market with appropriate high-level skills (encourage employability skills);
• To contribute to the socialisation of enlightened, responsible and constructively critical citizens (the development of analytical skills);
• To contribute to the creation, sharing and evaluation of knowledge (DoE, 1997)
The selected four purposes of Higher Education in South Africa suggest that neoliberal theory is not strange in South Africa, lifelong learning which is being emphasised by the White Paper, is a neoliberalism concept; it is a model of governing individuals in their relation to employability. Furthermore life-long learning is a strategy for the development of citizenship, social cohesion, and employment and for individual fulfilment. In support of this Bitzer and Botha (2011:45-46) also mention that higher education in South African institutions is stressing institutional autonomy, academic freedom, public accountability and the HEQC evaluative study of institutional audits. The
South African university is urged to fulfill the mentioned aspects. All these aspects are embedded in neoliberalism principles.
The four purposes of higher education listed on the previous page have aspects of neoliberalism; these include, accountability, individual liberty and employability. Higher Education picked up these principles, because they are essential as part of human advancement and development. Maistry (2014:181), in support of neoliberalism, says that as long as the nation remains convinced by neoliberal political and bureaucratic elite, the purpose of education is to advance economic growth. Higher Education is viewed as the only capable vehicle to advance economic growth and development. Thus it is crucial to develop higher education curricula that are performance driven and goal oriented.
Higher Education has a mandate to promote such values in the curriculum. This is the reason why CHE produced several publications on the responsiveness of the curriculum, (Bitzer & Botha, 2011:45-46). This might be the ultimate reason why neoliberalism principles are part of the four purposes of higher education, since they encourage human capital investment. The four purposes of higher education listed in the White Paper are geared towards the empowerment of graduates.

NEOLIBERALISM AND HIGHER EDUCATION

The general purpose of Higher Education is to serve the needs of the economy through investment in education. Apple (2000:105) argues that human capital is an important source of economic growth and innovation and an important factor in sustaining development and a means of reducing poverty and inequality. Thus Higher Education as a vehicle of human capital accumulation should be structured towards producing highly skilled and motivated workers or nation developers. In this regard, human capital is a leading source of economic growth because a highly educated citizen is capable of developing himself and the nation. No nation can prosper without educated citizens, because they are the ones who engage more in Research and Development, (RD). Universities across the globe are producing cadres with knowledge and skills, useful and appropriate to their economies.
Universities are seen as contributing directly to national economic regeneration and growth. In agreement with this Boden and Nedeva (2010:39) say that, the advent of neoliberalism saw this social contract between universities and society change dramatically. Student enrolment in Higher Education is increasing at a very alarming rate partly because of the need for specialised skills and also due to mass education. Universities are, therefore, pressurised to produce graduates who are capable of developing nations and graduates who are able to come up with policies which give answers or solutions to economic problems. The continuously increasing number of tertiary enrolment is a clear indication that employability principles are supposed to be implemented in higher education learning programmes.
Higher Education is therefore mandated to produce graduates who can compete in the global knowledge economy. Skills development through higher education leads to greater competitiveness and economic prosperity. This is the reason why universities today are trying to offer degree programmes which equip students with transferable skills, which make students employable (Yorke, 2004:405). Furthermore mobility is highly recommended in the labour market, thus employability skills are emphasised in the White Paper as one of the purposes of higher education in South Africa. The following section is focusing on Higher Education and employability skills.

NEOLIBERALISM AND EMPLOYABILITY SKILLS

The term employability, however, is an extremely complex term and very difficult to explain or define. However, Bhanugopan, and Fish, (2009:110) maintain that employability can mean a set of achievements, skills, understanding and personal attributes that make graduates more likely to gain employment and be successful in their chosen occupations, which benefit themselves, the workplace, the community and the economy. Yorke, (2004) adds that employability is not the same as gaining a graduate job; rather, it implies something about the capacity of the graduate to function in a job and be able to move between jobs, thus remaining employable throughout their life. Employability is therefore the ability of to be employable, creative, and flexible, and to be in a possession of skills which are beneficial for future development. Thus the White Paper has employability as one of its purposes so that graduates will be highly mobile and able to respond to the changing needs of the workplace. Therefore, institutions should be concerned with both the effectiveness and the efficiency of what they produce. The main focus is to produce graduates with transferable skills and who are able to use personal and academic skills, (hard and soft skills). Both skills are crucial in the work environment and for personal growth as well.
Employability is one of the principles of neoliberalism, which can be traced from the twentieth century when debates addressed the economic value of education or the relationship of education and the market (Bacevic, 2014; Boden & Nedeva, 2010; and Yorke, 2004). To effectively promote employability skills there must be that interconnection between the industry, the student and the university. The three components must work ‘hand in glove’ as depicted by the diagram. This interconnection will keep the three well informed about what is needed by the dynamic world.
Bacevic, (2014:285) argues that the development of nations demands that the entire activity of education and training should be directed towards education for work and through work. Graduate employability has moved to the forefront of higher education, especially through the principles of neoliberal education. The neoliberalisation of universities has facilitated the re-framing of employability discourse especially in the UK; graduates are not supposed to be educated only but also to be employable (Bacevic, 2014). As Yorke (2004) argues, transferable skills must be emphasised because, “good learning, teaching, and assessment practices foster attributes valued in the labour market and contribute to student employability.” Some universities are trying to come up with strategies which promote employability skills. The University of Edinburgh (UK) is one of them, thus they came up the following the Strategic Plan for 2012-2016:
• Focusing on graduate attributes and employability in our entire curriculum to equip our students to compete in the global market place;
• Producing graduates with socially and economically valuable attributes and expertise;
• Increasing students satisfaction with the opportunities and support for developing their graduate attributes and employability;
• Equipping our students with the expertise and graduate attributes they need to achieve their full potential within the global community; and
• Brokering strategic partnerships between academics, industry, specialists and other institutions to enhance the development of graduate attributes in all students.
(Source: The UK strategic plan for 2012-2016)
This strategic plan suggests that if these employability principles are embedded in the curriculum graduates will be fully equipped to achieve their highest potential in the workplace. The strategic plan is being implemented with the hope of assisting graduates in getting employment, bearing in mind that universities across the globe are producing large numbers of students, thus such strategic plans are appropriate in order to equip graduates with employability skills or transferable skills. Transferable skills have a multi-purpose; they can use them to become entrepreneurs, so they become self-employed and employ others in the process. They can also move across jobs which make them highly employable and remain employed. This is supported by Boden and Nedeva (2010:38) who say that the employability of students are based on the assumption that the economic welfare of individuals and the competitive advantage of nations have come to depend on the knowledge, skills and entrepreneurial zeal of the workforce. It is clear that most nations are encouraging higher education to consider employability programmes in their curriculum.
Links with the labour market are deemed as one of the most vital aspect of higher education. Thus university programmes should have a component of employability skills. Yorke, (2004:405) is convinced that, a mechanism can be developed where representatives of enterprises and factories would come together with representatives of education institutions and jointly define the components which can be incorporated. There is a strong and inseparable link between the education system and the labour market. Yorke (2004:405) goes on saying, it is vital that the entire young generation starts integrating into labour life at an early stage and continues to be educated through the labour markets. In this regard, the early stage in higher education is undergraduate education. Thus it is of great importance that undergraduate programmes should empower students with skills needed by the industry not theory only. Authors like Bacevic, (2014) and Yorke, (2004), agree on the fact that students need not only have learned a lot but also have learned how to learn. Students must have the ability to be creative, and flexible in the rapidly changing work environment.
Yorke (2004:409) argues that the task of the government in the global competitiveness is to foster growth in the stock of human capital, since this is seen as critical to the success of knowledge-based economies in the global society. Yorke (2004) elaborates further saying education and training enable people in any given society to compete with the rest of the world. For graduates to be able to compete globally nations need to invest in human capital and research and development. The next section looks at what neoliberalism says about human capital which is one of the ingredients of economic growth.

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NEOLIBERALISM AND HUMAN CAPITAL

The human capital ingredient is recognised as a major input in the production function that generates growth. The skills enhanced by education are complementary to the technological input to advance overall productivity through human capital advancement. According to Kasliwal (1995:146) human capital may be viewed as just another form of capital, a durable resource that returns a stream of services for production or consumption into the future. Research and development skills can only be attained through the promotion of human capital.
This is the reason why universities are perceived by political leadership as sources of innovation, especially in scientific and technological areas that feed high-tech productivity, (Kasliwal, 1995:144). Since the 1980s nations have been urged to adopt commercial models of curricula that promote human capital. This stance is supported by Kasliwal (1995:147) who postulates that as national borders become ever more porous, a forward-looking strategy must modify the domestic educational system accordingly. Bearing this in mind, the first obvious need is for a nation to implement a skills-based curriculum in order to have highly skilled manpower so that if the country is outsourcing labour the departing expatriates will be replaced. Producing highly skilled graduates is underscored by the White Paper and it is also a neoliberal principle.
Developing countries across the globe need a more skills-based curriculum. This will enable higher education to produce individuals who are competent, goal-driven and self-motivated. Thus developing nations should invest in human capital skills; currently most developing countries are outsourcing highly skilled labour as mentioned earlier, because of the shortage of highly skilled labour, South Africa included. Peters (2001:58) postulates that the move from democracy to neoliberalism is a move from a culture of dependency to a culture of self-reliance. Peters (2001) goes further saying enterprise culture provides the means for analysis and the prescription for change: education and training are key sectors in promoting national economic competitive advantages and future national prosperity. This can be achieved by highlighting self-reliance, self-improvement and self-worth (Peters, 2001).
In addition to that countries grow if they are able to access and absorb knowledge from more advanced countries especially through research and development (RD). The highly educated are the ones who are able to absorb knowledge and skills. Neoliberalism underscores the importance of human capital according what has just been discussed. Employability and human capital are not the focus of this research, they are included just as part of the mandated elements of Higher Education. The next section focuses on neoliberalism and the undergraduate Economics curriculum

NEOLIBERALISM AND UNDERGRADUATE ECONOMICS CURRICULUM

Cammack, (2002:166) postulates that, neoliberalism celebrates those who strive for excellence. What this entails is a shift away from explicit concerns with inequality towards more explicit concerns with economic freedom and growth. In support of this, Maistry (2014:180) says; neoliberalism supports a value system grounded in self-discipline, self-reliance and the accompanying pursuit of self-interest. Competition is presented as an acceptable, moral characteristic. In agreement cooperative competition is health for growth and quality promotion so cannot shy away from competition. Furthermore, competition leads to efficiency in the market. Equity is compromised in a neoliberal economy market but not ignored. The minimum government intervention allowed by the neoliberal is to ensure that equity is covered.
Neoliberal strategies for higher education have the following features: all constituencies are viewed through business relationships; educational efficiency, accountability and quality. More broadly, neoliberalist education promotes an enterprise education focusing on empowering individuals so that they invest in their own education. This is supported by Cammack (2002:166) who argues that the neoliberalism ideology stresses an increase in entrepreneurial activity, the rapid development of accounting systems of quality control, a stress on the relationship between universities and the private industry. The theory encourages the interconnectedness between the higher education institutions and industries through its principle of employability, as noted earlier. Researchers like Zuidhof, (2014), analysed economics textbooks and came up with the conclusion, that economics textbooks have numerous aspects of neoliberal principles. In this study undergraduate economics textbooks used in the South African universities were also analysed to find if they have neoliberal aspects in them. The results of textbook analyses are presented in Chapter 5. The next section discusses neoliberalism and South African education.

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NEOLIBERALISM AND THE SOUTH AFRICAN EDUCATION

The introduction of Annual National Assessment (ANA) is a clear indication that multiculturalism is being replaced with a meaner, harder logic of competition on a global scale, and a strategic, outward-looking cosmopolitanism policy (Mitchell, 2003:389). This is all about setting national standards and accountability, by setting global competitiveness, (educational standardisation and accountability). This is supported by Maistry (2014) who stresses that the echoes of neoliberalism are being heard and felt quite well in South Africa, for instance through the implementation of the standardised tests and national examinations and also the implementation of the Annual National Assessment (ANA).
South Africa also adopted the National Senior Certificate to regulate content and also to regulate student behaviour through the national curriculum. There must be national standards and national systems of assessment. In essence it is a move away from multicultural education, which is liberal in nature. In agreement with this Maistry (2014:179) says that, high-stake testing and strong accountability regimes have their roots in neoliberalism. In the last 25 to 30 years neoliberalism economic imperatives have been driving the strategic direction of the education policy across the world. There is no way in which South Africa can avoid the influence of neoliberalism, because some of the principles of neoliberalism are essential for quality education. The main reason why neoliberal aspects are being adopted in the South African educational system is that, most of the people are lamenting poor educational performances in South Africa, blaming teachers, the curriculum and the trade unions.

NEOLIBERALISM IN AN INTERNATIONAL CONTEXT

A few glimpses of international literature on neoliberalism development in higher education will be highlighted. In Africa a similar study was conducted in Ethiopia by Zehle (2012). The study is entitled: Towards higher education in a post neoliberalism future. Zehle’s (2012) argument is based on the weaknesses of neoliberalism. The angle which Zehle (2012) used to tackle neoliberalism is similar to that of Bond (2000). She too argues that neoliberalism is evil, because it is causing social instability and enriching a few at the expense of many. Ethiopian education adopted neoliberal education; it is operating according to a logic that has its basis in neoliberal management and market ideas. Neoliberalism is not an African ideology as it should be regarded as Eurocentric. According to Zehle, (2012) African problems cannot be solved by neoliberal principles. Neoliberal principles are, however, not new in Africa. For example, Julius Kambargwe Nyerere, who was the President of Tanzania, implemented principles similar to neoliberalism in 1974. Nyerere’s philosophy was Afrocentric in nature and was known by the name Ujama. Nyerere’s principles of Ujama were rooted in self-reliance where the individuals were supposed to divorce themselves completely from the dependency syndrome and to be accountable for their destiny. Education programmes were supposed to marry theory and practice. This principle also had the component of employability, because theory was supposed to be linked to work experience. Nyerere had seen the benefits of transferable skills and accountability. Transferable skills are key when it comes to adaptability, functional mobility and continuous learning (Osleen 2006; Yorke, 2004).
Neoliberal aspects are also echoed in a research conducted by Baxter and DeJaeghere (2014). Their research is based on, entrepreneurship education for youth in Sub-Saharan Africa. The main gist of this research is the capabilities of entrepreneurship as an alternative framework of neoliberalism. Entrepreneurship in this study is taken as a solution to economic problems. Much of the research conducted in Africa did not address the main focus of this study; however, they gave the researcher the background knowledge of the development of neoliberal theory and also revealed the gap in research.
There is a lot of literature on undergraduate Economics curricula, but research on neoliberalism and the development of the undergraduate economics curriculum is under researched. Most of the research available is about the negative side of neoliberalism. However, this doctoral study is not about the weaknesses or strengths of neoliberalism but its development and influence on the undergraduate Economics curriculum in a South African context.

MAJOR ARGUMENTS AGAINST NEOLIBERALISM

Neoliberalism is mainly attacked for ignoring public goods and system functions. This is supported by O’Hara (2005:1) who adds that neoliberalism is critiqued for reducing the standard of living of the working class and promoting a corporate crisis through insufficient governance. The argument is that corporate companies are the ones who are literally in power, so laws and regulations in the market are at their advantage. As their ideas are ruling ideas the market is their sphere of influence, hence there will be market failures. O’Hara (2005:12) adds that the free market can also add to unproductive abuse of power by excessive CEO salaries, conflict of interests between auditors, and financial advisors, accounting irregularities, and environmental destructions. In this case power is diverted to benefit their interests and their motives. O’Hara (2005:2) is correct when he says neoliberalism does have its forward looking aspects as well as problematic aspects. In actual fact, there is no one-sided ideology, positives and negatives are infused in any given ideology. The planned system was abandoned for its shortcoming especially that of failing to promote economic growth.
Jessop (2002:465) in support of neoliberalism argues that global capitalism is promoted, because welfare states are costly, overburdened, inefficient, and incapable of eliminating poverty, overly oriented to cash entitlements rather than empowering citizens. The welfare state should be dismantled in favour of policies that emphasise moving people from welfare into, work, that link social and labour market policies, and that provide incentives to learn and/or prepare them for a new job. Too much dependency on the state promotes laziness and put pressure on the government unnecessarily. Thus democracy can be contested for encouraging too much dependency on the state killing quality which is compromised for equity. This is supported by Marginson; (2006:206) who maintain that not all is growing well in the garden of democracy in education; if there is no crisis, there is certainly a malaise. Education in SA is criticised by many because of its high failure rate and also for the fact that it is failing to give answers to societal problems.

Table of contents
DECLARATION
DEDICATION
ACKNOWLEDGEMENTS
Abstract
CHAPTER 1: INTRODUCTION AND BACKGROUND
1.1 Introduction
1.3 Economics as a subject
1.4 Context of the study
1.5 The nature of Higher Education in South Africa
1.6 Research problem and objectives
1.7 Originality of the study
1.8 Research design and methodology
1.9 Ethical issues
1.10 Outline of the thesis
1.11 Summary of chapter
CHAPTER 2: A HISTORICAL PERSPECTIVE OF NEOLIBERALISM AS THEORETICAL PHENOMENON
2.1 Introduction
2.2 The purpose of literature
2.3 Conceptualisation of neoliberalism
2.4 The development of neoliberalism
2.5 Characteristics of neoliberalism
2.6 Theories that inform the evolution of neoliberalism
2.7 Neoliberalism and the Keynesian theory
2.8 Neoliberalism and classical liberalism
2.9 The development of economics theories
2.10 Neoliberalism and the philosophy of economics
2.11 Neoliberalism and the epistemology of economics
2.12 Neoliberalism and the South African economy
2.13 Summary of the chapter
CHAPTER 3: THE RELEVANCE AND IMPACT OF NEOLIBERALISM TO HIGHER EDUCATION
3.1 Introduction
3.2 Curriculum transformation in South African higher learning institutions
3.3 Neoliberalism and Higher Education
3.4 Neoliberalism and employability skills
3.5 Neoliberalism and human capital
3.6 Neoliberalism and undergraduate economics curriculum
3.7 Neoliberalism and the South African education
3.8 Neoliberalism in an international context
3.9 Major arguments against neoliberalism
3.10 Summary of the chapter
CHAPTER 4: RESEARCH DESIGN AND METHODOLOGY
4.1 Introduction
4.2 Research paradigms and epistemological assumptions
4.3 Research design and methodology
4.4 The process of data analysis
4.5 Data quality
4.6 Ethical considerations
4.7 Reflection on research methodology
4.8 Summary of the chapter
CHAPTER 5: DATA PRESENTATION AND ANALYSIS
5.1 Introduction
5.2 The role of Economics textbooks
5.3 Study guides and neoliberalism aspects
5.4 Interviews
5.5 Summary of data collected from the three sources
5.6 Chapter summary
CHAPTER 6: DISCUSSION OF FINDINGS, RECOMMENDATIONS AND FURTHER RESEARCH
6.1 Introduction
6.2 The aim of the research
6.3 Summary of chapters
6.4 Discussion of the findings
6.5 Recommendations
6.6 Recommendations for future research
6.7 Limitations of the study
6.8 Contributions of the study
6.9 Chapter summary
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