[CULTURAL DIMENSIONS]What makes a school attractive?Does zeal for education cause property values in one place to rise at an unreasonable rate? This question is the latest hypothesis devised to explain surging property values in the Gangnam area of Seoul.
The theory has gained traction among economists who argue that the concentration of famous schools and private institutes in Gangnam creates great demand for housing in the area, causing prices to skyrocket. Reforming the education system, they argue, will help restrain the rise in property values in the area.
Not everybody agrees. Minister of Education and Human Resources Yoon Duk-hung said recently that “the relationship between education and property values is a chicken-or-egg question” that defies an easy answer. He also said that the government has no plans to eliminate school districts and revive competitive entry to high schools. Such a move would open up the famous schools in Gangnam to students who live anywhere in Seoul, which would take pressure off property values in the area.
A look at other countries shows that there is indeed a relationship between education and property values. The most glaring example is the United States, particularly in states that fund education with local property taxes. In this system, school districts with high-income residents can spend more on education because they have a stronger financial base; the richer the community, the better the schools. Good schools become important in attracting people to the area, which pushes property values higher. In most parts of the United States, people who want good schools have to find a way to move into a wealthier area.
In Japan, schools are funded mainly by local income taxes, and tax rates across the country vary less than in the United States. School districts exist for elementary and middle school, which means that parents take an interest in the type of students that attend the nearby school. People may want to move out of a school district that has a middle school with a number of “problem students.” A close look at the economic geography of large urban areas shows that the upper middle class is concentrated in particular areas, such as the west side of Tokyo and the north side of Osaka, much as the upper middle class has concentrated itself in Gangnam.
Going back to competitive selection for high schools, for example, would not do much to change the situation because Gangnam would still be a desirable area for education. Most large public school systems in the United States, for example, now have magnet schools that select academically strong students from across the school district. Some of the oldest and most famous public magnet schools are in New York City, and one of them, the Bronx High School of Science, has produced five Nobel Prize winners, more than any other high school in the United States, as well as leaders in all fields of American society. Likewise, Japan has competitive entrance for all high schools and for special and private middle schools. In urban areas, private middle and high schools that have a combined six-year curriculum are popular because a higher percentage of students from these schools enter famous universities.
The Bronx High School of Science and famous private high schools in Japan have not turned the surrounding neighborhoods into centers of real estate speculation. Good elementary schools, the living environment, and daily-life amenities all work together to make certain areas more desirable than others. Changing high school or university entrance procedures will do little to make Gangnam less desirable.
Real estate bubbles are bad for the economy, as any Japanese who rode the waves of speculation in the late 1980s can attest. Property values are rising at a dangerously high pace in many parts of the United States and Europe, and will have to slow. Sharp rises in property values are usually driven by the same combination of speculation and desire for location that is feeding the rise in prices in the United States and Europe. If this is a problem, it should be addressed as an economic, not an educational one.
The educational problem in all is how to balance merit and opportunity. Merit rewards excellence, but such a system means little if excellence is not clearly defined. For all the interest in education, there is almost no discussion of what a good education is or what a good school should do. Developing and debating hypotheses about these questions is the most urgent task facing the Korean education system today.
* The writer is an associate professor at Kyoto University in Japan.
by Robert J. Fouser