Not the debt burden, but a lack of competitiveness is the biggest problem of the Greek economy. In one area, though, Greek export performance seems outstanding. Greece ranks among the top exporting countries of students. Each year, more than 30,000 Greek youths study abroad. In contrast, Greece imports very few foreign students (apart from Greek-Cypriots). From Holland, each year fewer than 20 students depart for a study in Greece, against an opposite flow of about 700. My own institution – Erasmus School of Economics – this year received a record of 200 master applications from Greek students. This puts Greece at the top of the list, beating even the Chinese contingent.
Unfortunately, this export surplus doesn’t help the Greek balance of payments, at least in the short term. Studying abroad requires funding for tuition fees, travel expenses and cost of living. A hard-working student may raise some funding in the host country through part-time jobs, but in many cases some funding from the home country is still needed. This is recorded as a money outflow on the balance of payments. Greek student mobility is thus not a sign of competitiveness. On the contrary, the state of Greek higher education is symptomatic of the Greek economy in general.
The outflow of Greek students may suggest that Greek higher education is a scarce good and that students either need to pay high tuition fees or queue for a place at university. Nothing is further from the truth. Tuition fees are zero and participation in tertiary education is high compared to other EU states. Although higher education is not a scarce good, high quality education is. The brain drain partly reflects a quality issue. Greek youths with rich parents or an entrepreneurial spirit study abroad because the value of a foreign diploma is higher. In contrast, the sun, the sea and ancient Greece do not tempt students from other EU countries to study in Greece.
In many ways, Greek higher education is a microkosmos of what is wrong with Greek society. Its citizens expect public services to be for free. Educational institutions suffer from overstaffing, nepotism and clientelism. Quality control and incentives to perform are lacking.
What is the way forward? An obvious reform would be to price education, by starting to charge tuition fees. But even then it will take time and extra investment to bring Greek tertiary education to a higher level. A smarter solution would be for the government to turn Greek students’ willingness to study abroad to its full advantage. Their mobility implies that Greece can utilize Europe’s complete educational capacity. That disposes of the need to sustain programs in the full range of academic disciplines within Greece. It enables Greece to focus educational spending and to cut expenses. Greek higher education could then become smaller, better and cheaper. So, in the future, foreign students might come to Athens for a top master in archeology or tourism, but Greek students wishing to pursue an economics study would go to the US, the UK or to Erasmus School of Economics.