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Education policies can discriminate against different income groups through the supply of educational opportunities. Expansion of primary school facilities in neglected areas, in this case rural Colombia, may have a high rate of return as well as raise relative incomes of poor people. A simple theoretical model deals with linkages between efficiency in distribution of education and distribution of income. Despite increased percentages of enrollments at every educational level in Colombia, access to education in rural areas remains severely limited. Recent studies discuss private and social rates of return to primary schooling for males and females along with some reference to vocational schooling, which overall yielded the highest returns. Increasing rural primary school opportunities has far-reaching implications; for example, on effects of rural education on migration to urban areas, increased productivity, and rural economic development. Returns to primary education may be lower in rural than urban areas although the most advanced rural regions may receive highest returns to education. Even where private rate of return is low, benefits in crime prevention, health care, improved literacy, and lower birth rates justify the investment. Dropout prevention policies should be tied to expansion. (RS)

The student loan program run by the Instituto Colombiano de Credito Educativo y Estudios Tecnicos en el Exterior (ICETEX) has three main objectives: to increase the country's supply of highly skilled manpower, to achieve more equality of educational opportunity, and to provide a meaningful source of finance for higher education. An analysis of 4,100 accepted loan applications from the years 1969-1971, or about 15 percent of the total loans granted during that period, reveals that success in reaching ICETEX's objectives has been mixed. By concentrating loans in particular fields of study, ICETEX has had a substantial impact on the structure of the country's educated manpower. While loans to students in Colombia's public universities tend toward equalization of educational opportunity, loans to students in private schools are often larger and go to more socially privileged students. Since public university tuitions must be kept low for political reasons, loan moneys go either for tuition at more expensive private colleges or pay student living costs, and provide no effective financial assistance to the public institutions. Extensive tables displaying the research findings follow a discussion of possible improvements in the ICETEX system. (Author/PGD)

The costs of education are usually shared by governments and students. Cost benefit analyses have failed to indicate how these costs should be apportioned, since such analyses measure only economic benefits and leave out the psychological, sociological, and political benefits governments and educators must consider in financial planning. Economists have also ignored the question of how the increased cost of more effective education is to be paid and how much those paying but not being educated will stand to benefit. Analysis of the public financing of education in Colombia shows that such financing does contribute to redistributing income from the rich to the poor, particularly at the elementary level in urban areas where the poor benefit from public education while the rich make use of private schooling. Public support of secondary and higher education benefits the middle classes at the expense of both rich and poor. Public financing also tends to redistribute wealth from richer to poorer districts of the country. A dynamic analysis of the effects of such redistribution over time, which would have great implications for planning policy for the future, remains to be made. (Author/PGD)