Journal of International Development Cooperation
Korea International Cooperation Agency

Approach for Higher Education Reform by International Organizations and the Reaction of Latin America

Minkyung Shin1,*
1Ph.D Candidate, Seoul National University
*Corresponding author :

© Copyright 2022 Korea International Cooperation Agency. This is an Open-Access article distributed under the terms of the Creative Commons Attribution Non-Commercial License ( which permits unrestricted non-commercial use, distribution, and reproduction in any medium, provided the original work is properly cited.

Received: Aug 31, 2022; Revised: Oct 11, 2022; Accepted: Oct 24, 2022

Published Online: Nov 30, 2022


Higher education (HE) in Latin America has experienced explosive growth over the past half century, and countries have made their own efforts to reform HE. However, with the intervention of international organizations since the 1980s, HE in Latin America has been influenced by neoliberal ideology. In view of the gap between what Latin American society actually wanted and what international organizations required, this study examines the overall HE reform direction advocated by the latter and how Latin American countries actually accepted or rejected it, especially during the 1990s. However, since this is an introductory study, future research will need to investigate the mechanism of HE reform through external pressures and internal reactions in more depth, considering the contexts and circumstances of each country.

Keywords: Higher Education Reform; Latin America; Neoliberalism; Privatization; World Bank


External environment and discourses surrounding higher education (HE) such as globalization, internationalization, and neoliberalization have a significant influence on developing countries. How do the universities in developing countries take their positions under these circumstances? When taking the worldwide environment faced by universities into consideration, although world-class universities in developed countries are capable of self-development, those of developing countries may have some difficulties. They, at best, borrow policies from the developed world or adopt strategies recommended by international organizations such as the World Bank (WB) in order to control their quality. Inter alia, it is important to examine the effect of international aid organizations because in case of developing countries, HE reform could be easily conducted through an international aid agency network (Torres & Schugurensky, 2002). Torres & Schugurensky (2002) explain that ‘institutional capitalism’, a concept proposed by Useem (1986), is identified differently in HE of developed countries and that of developing countries. In core countries, strong capital class and relatively autonomous government lead in HE change through co-research, conferences, and forum. For instance, there could be a forum intended to make a favorable environment for business administration by expanding the role of private sector in national economy and universities (Slaughter, 1990). On the other hand, peripheral countries cannot form adequate HE policies in the new economic paradigm because they are not independent and have weak capital class (Torres & Schugurensky, 2002).

Meanwhile, although it is known as the relationship between economic growth and HE is quite close to each other, Latin American universities had not been expected as important agents for economic growth because the region’s industry was based on commodities and services which have comparatively lesser value than added value of knowledge and capability (Arocena & Sutz, 2005). However, the paradigm promoted by organizations like the WB and Inter-American Development Bank (IDB) postulates that the region’s universities support the society’s capitalistic economic development (Espinoza, 2017). Under this premise where there is a discordance between what the society wants and what international organizations require, it will be crucial to look into how international aid agencies’ strategies towards developing countries’ HE reform and how the region has carried out the policies. In particular, Latin American HE has gone through a rapid expansion for fifty to sixty years. It is said that barriers to university access have been mitigated through that expansion, and it seems like the link between national economic growth and HE should be more significant under this phenomenon.

Over the last three decades, Latin American countries have made various attempts for a change in the national HE system, and have implemented or at least suggested structural reforms. Thus, Latin America can be a fertile case to conceptualize and learn about contemporary HE reform (Bernasconi & Celis, 2017). Furthermore, by analyzing external influences and internal respond regarding Latin America’s HE reform, it will be possible to discuss the region’s position about HE and to come up with implications in order to realize desirable principles shared within the area of education development.

In the strict sense, this paper is not written for a profound academic discussion. Its purpose is to introduce and to share a general picture of the aspects and characteristics of international organizations’ development cooperation approach for HE reform, focusing on neoliberalism and privatization, and to explain the reaction or response of Latin America. It would be beneficial to analyze how the actual status of Latin American HE policies are being implemented after all those pressure from international organizations, especially from the perspective of international development cooperation, but this would be beyond the scope of discussion of this paper. Meanwhile, considering the fact that the scope of analysis is quite broad and neoliberal ideology acts differently in each country’s context and environment, this paper could be a stepping stone for future research, for instance, what the mechanisms of HE reform were and who the driving forces were in a specific country, how the tension between the external pressure and the internal resistance was, and so on.

The remainder of this paper will start with a brief introduction of Latin American universities’ background, progress, and status. Secondly, as an introductory content, aspects and characteristics of international organization’s development cooperation approach for HE – focused on universities - reform since the 1980s, especially during the 1990s will follow. Here, the analysis will aim to see the aspects of neoliberalism and will be limited to the approach of the WB’s development aid on national-level HE policy.1) Thirdly, in the following section, how Latin American countries have responded will be identified, in terms of acceptance of HE policy and movement of resistance. Here, this paper will focus on privatization, one of the major trends spawned by neoliberalism. Afterwards, fourthly, a couple of points of criticisms regarding the WB’s approach will be discussed with a conclusion at the end.


Latin American HE has begun in the early 1500s (Ferreyra et al., 2017). Established just after the arrival of Spanish conquerors, these colonial universities were subordinated to the government and the church (Arocena & Sutz, 2005). However, even after independence, they still retained colonial legacy (Benavides et al., 2018). It was not until the early twentieth century that Latin American universities started to involve themselves in social concern and to contribute to political and cultural change (Arocena & Sutz, 2005). Most of all, the Cordoba Movement of 1918 led by students in Argentina was a watershed of institutional development that enabled universities to construct societal democracy beyond to pursue internal autonomy and democratization, which consequently affected other Latin American countries (Arocena & Sutz, 2005; Benavides et al., 2018). The Movement also contributed to the expansion of HE enrollment and the free access to it, dealt with the promotion of research which contributes to national development, and put up the “extension2)” function (Arocena & Sutz, 2005).

Following this Movement and also due to increase of public demand of HE, Latin American HE has continuously expanded since the 1960s in terms of size and enrollment (Torres & Schugurensky, 2002). About one thousand three hundred students were enrolled in the 1960s, but this figure increased to more than twenty million in the 2000s (UNESCO, 2011). The <Figure 1> shows how the gross HE enrollment in Latin America changed from 1965 to 2000, based on nine countries. This region’s total enrollment of HE steadily increased, even after 2000. In the early 2010s, there were more than ten thousand HE institutions and sixty thousand programs in Latin America (Ferreyra et al., 2017).

Figure 1. Gross HE enrollment in Latin America and the OECD, 1965–2000 Source: Holm-Nielsen et al. (2005: 40). Note: HE, Higher Education.
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However, “the 1970s’ spike in crude oil prices, drop in export prices, and abolition of agricultural trade disturbed lots of Latin American countries in expanding public investment to public education” (Lee, 2008: 106). Although public spending in HE even saw an increase in Latin America before the 1980s except Argentina and Chile which faced economic crisis at that time, most of the Latin American countries did not have enough fund and lacked political will since the 1980s, which drastically decreased public spending towards education sector (Balán, 1993). However, it was necessary to take measures in order to accept the society’s various demands regarding HE expansion, so it boiled down to the introduction of private HE. Lee (2008) says that the enlargement and diversification of HE institutions partly decreased the financial burden of public HE and contributed to the expansion of HE itself. Nevertheless, it led to the low quality of HE. sshows the percentage of total enrollment in private HE institutions in Latin American countries. It is visible that lots of countries had moved from the column on the right side to that on the left.

Table 1. Private HE in Latin America, 1985–2002
Percent of total enrollment
Year 40–75 percent 30–40 percent 20–30 percent 10–20 percent Less than 10 percent
1985 Brazil
Dominican Rep.
El Salvador
Costa Rica
2002 Brazil
Dominican Rep.
El Salvador
Venezuela Argentina
Costa Rica
Honduras Cuba

Note: HE, Higher Education.

Download Excel Table

In short, the overall expansion of HE in the 1980s was realized by private sector that absorbed the demand. In case of Brazil, Chile, Colombia, Ecuador, and Peru, loans and scholarships raised accessibility towards private institutions, which explains that private sector coped with the demand when public universities were restricted (Ferreyra et al., 2017). Of course, in Argentina, Mexico, Uruguay, and Venezuela, public universities expanded and diversified, and new public institutions absorbed newly increasing demand (Holm-Nielsen et al., 2005). Notwithstanding these variances, private supply of HE in Latin America has generally increased. Private HE institutions, both for-profit and not-for-profit, are widespread in the region, and in the early 2000s, private institutions cover around 40 percent of total HE enrollment (ibid). It can be said that market dynamics gradually and rapidly started to alter the HE environment since the 1980s, and intervention of international organizations or agencies was closely intertwined with this situation.


1. Neoliberal Ideologies Permeated into Developing Countries

The aforementioned market dynamics and privatization3) are one of the important mechanisms of neoliberal ideology. Actually, it is not easy to define neoliberalism, its deployment and its institutional and geographical scopes (Palma Amestoy, 2021). However, to briefly introduce, neoliberalism is an ideology, which is structured, based upon the ideal thoughts of market freedom and self-regulation (Brenner et al., 2010). Deriving to a large extent from the global economic interests such as the United States and the United Kingdom, neoliberalism significantly advanced in the 1980s by Reagan and Thatcher. However, it has been continued throughout the 1990s and still exerting its influence (Torres & Rhoads, 2006).

Mexico and Brazil defaulted on their loans in the late 1981. And this was considered by the developed world as faults of developing countries themselves. It was recognized that the governments of developing countries were corrupted, highly interventionist, bureaucratic, and inherently inefficient and this was why Structural Adjustment Programs were introduced. WB and International Monetary Fund (IMF) together started to intervene in the policy of developing countries with Structural Adjustment Programs, mapped out to cut the extent of state intervention in the economy, retrench government expenditure, and promote international trade and liberalization (Simon, 2002). And these requirements were offered as conditions for monetary loan from aid agencies. Accordingly, developing countries not only went under various restrictions in socio-economic policies but also were affected in educational spending (Alcántara et al., 2013). Not different from this trend, most of the Latin American countries introduced neoliberal strategies to stabilize the finance and adjusted economic policies, which were promoted by international aid agencies. In return, spending on services had been reduced which were traditionally treated as crucial role of government, and to yield those services to the market (Rosskam, 2009).

In case of education, privatization and decentralization were a few of the methods favored by the WB and IMF in order to enhance educational efficiency (Arnove et al., 1996). Especially for HE, neoliberalism highly affected the surrounding environment and HE reform towards developing countries in the late twentieth century. This means that when examining contemporary HE, it is important not to leave aside the fact that neoliberalism had become the dominant discourse and the ideological framework in social formations in many different countries (Palma Amestoy, 2021). Universities have been passing through neoliberalization processes, which are characterized by several issues (Raaper, 2017). Raaper (2017) asserts that neoliberalized universities go through reform and development of institutional regulations for the sake of quality assurance4) and accountability. Canaan (2010) argues that audit, (new) managerialism or quality assurance have been introduced as new forms of accountability. Torres & Rhoads (2006) suggest four major fields on which the power of neoliberalism was reflected, in terms of impact on HE: accountability and efficiency, accreditation and universalization, international competitiveness and massification, and privatization. There is no consensus in classifying the impacts of the HE sector, as different scholars have different approaches. Narrowed down to Latin America, Alcántara et al. (2013) argue that neoliberal policy in HE sector is characterized by decentralization, assessment, accountability, and privatization. Salvador Peralta & Pacheco (2014) explain that in Latin America, neoliberal HE reform plays a part in three different tendencies — privatization, diversification, and accreditation. World Bank (1986; 1995) described approaches of HE reform into seven categories, which can be summarized into privatization, diversification, and accountability.

2. The World Bank’s Higher Education Reform towards the Developing Countries: Trend, Agenda, and Strategies in General

The WB Group was established in order to rebuild war-shocked world and to provide a “new economic order” to prevent the US system from being shattered by the depression in the 1930s (La Feber, 1989). Especially, International Bank for Reconstruction and Development (IBRD) was tailored to provide each country with governmental framework for private investment in the future (Kolko & Kolko, 1972). Moreover, International Finance Corporation (IFC) makes international private partners to actively participate in the businesses of de-nationalizing and privatizing strategic assets of host nations (Delgado-Ramos & Saxe-Fernandez, 2009). Especially in the 1990s, IFC has supported Latin American HE through establishment of new private institutions, fortification of existing private institutions, and developing student loan program which helps them enter into private HE institutions (IFC, 2001).

The WB started to operate in education since 1963, and HE accounted for 17 percent among education loan between 1963 and 1970 (World Bank, 2011). From 1971 to 1984, proportion of HE projects among the whole education increased to 38 percent (ibid). However, HE has fallen behind basic and primary education since the mid 1980s (World Bank, 1999a). This trend overturns from the middle and late 1990s and HE takes over a high position as universities’ role for global knowledge economy started to be emphasized (<Figure 2>).

Figure 2. World Bank Loans for higher education Source: Torres & Rhoads (2006: 190).
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Nowadays, the total amount of WB education loans is around US$4 billion per year, where about 30 percent is for financing higher-level reforms (Espinoza, 2017). For the WB’s sectoral specialists, HE needs to concentrate on the development of the technical capacities and the leaders for the economic growth (World Bank, 1995). From this point of view, market orientation would be the best way to ensure access to education and the equality of the system (Espinoza, 2017). Furthermore, the ‘market’ is like an engine, which enables the universities to act, and also a control mechanism, which is necessary for professional training of the human capital (World Bank, 1995). This means that the WB changed its focus from Psacharapoulos’s rate of return analysis, which gave the basis for emphasizing basic education in developing countries (Collins & Rhoads, 2010). This kind of shift can be identified in several reports from the WB. Especially, the WB’s thoughts of global knowledge economy revealed in ‘Higher Education in Developing Countries: Peril and Promise (2000)’, and ‘Constructing Knowledge Societies: New Challenges for Tertiary Education (2002).’ Post et al. (2004) shows the former asserting that without better and expanded HE opportunities, developing countries cannot earn that much in global knowledge-based economy. The latter contends that HE is necessary for the creation, dissemination, application of knowledge, and the formation of skilled and professional capacity. Also, it claims that developing countries are in danger of becoming marginalized within a competitive world economy since their HE system cannot properly create knowledge and utilize it (World Bank, 2002a).

However, these reports’ prescriptions contain neoliberal agenda. Most of all, ‘Higher Education: Lessons of Experience (1994)’ is well known for redefining the role of governments in regards to developing countries’ national HE system, and for recommending neoliberal solutions for quality improvement for education and research (World Bank, 1994). Moreover, the WB came up with ‘The Financing and Management of Higher Education (1998)’, which basically tries to accelerate privatization and adopt principles of neoliberal economics to HE (Johnstone et al., 1998). Here, it promotes increase of user fees, student loans based on market interest rate, improving education quality through entrepreneurial training, decrease of public education, and the like. Meanwhile, quality assurance and accountability were additional issues came out of neoliberal trend. This aspect has not been changed that much so far. The WB still thinks it would be a success if privatization consequently makes universities to have high rate or return (Woodhouse, 2011).

In the 1970s to 1980s, the WB’s HE projects provided support which was piecemeal, focusing on establishing new programs or discrete measures to improve teaching quality or research, and these kinds of projects could not offer long-term comprehensive support for HE which was required for successful reform and effective building of institution (World Bank, 2002b). Therefore, since the 1990s, the World Bank (2002b) has focused on three approaches: 1) promoted long-term and sustained participation in regards to reform efforts and comprehensiveness of the intervention strategies, 2) considered political-economy aspects of HE reform to induce consensus among various HE stakeholders, 3) promoted change through positive incentives such as competitive funds or quality assurance system. And the followings are the general types and some examples of the specific objectives of the WB’s HE intervention since the 1990s (ibid). 1) Vision development, consensus building, strategic planning, 2) financial reforms (cost sharing, student loans, scholarships, competitive funds), 3) governance reforms (establishment of policy bodies, mergers and federations), 4) quality improvement (fortification of existing programs, quality assurance systems), 5) institutional diversification, and 6) improvement of science and technology (capacity for M&E, competitive funds, public-private sector joint technology development).


The WB’s neoliberal HE reform projects started to be conducted regularly in the 1990s in Latin America (World Bank, 1999b). Chile was the fastest in the 1980s and other countries such as Argentina, Mexico, and Peru were applied in the 1990s (Bernasconi & Celis, 2017). Based on its recommendations, Latin American policy makers started to carry out a series of neoliberal HE reform in order to transform universities into more efficient and financially autonomous institutions (Jones, 2007; World Bank, 1994; 1998). This kind of reform contributed to create several critical tendencies, privatization, decentralization, quality assurance or accreditation, accountability, and diversification (Alcántara et al., 2013; Arnove et al., 1996; Bernasconi & Celis, 2017; Salvador Peralta & Pacheco, 2014; Raaper, 2017). This section will divide Latin American countries’ respond into two categories: acceptance and resistance. In regards to acceptance and application, it will briefly introduce examples for one of the most important aspects drawn from neoliberal HE reform effort — privatization. HE privatization believes that the best way to solve social and organizational problems is market competition. Torres & Rhoads (2006) argue that among the many phenomena surrounding HE that neoliberalism entails, privatization is particularly relevant in analyzing the policies of developing countries and international organizations such as the WB. According to them, the main policy of many international organizations that have intervened in international politics has included pressure to privatize many public sector services, including HE.

1. Acceptances and Application
1) Privatization5)
(1) More financial support towards private institutions

To begin with, private universities in Brazil represented more than 60 percent of the total enrollment in the 1980s and were provided with substantial financial assistance from the federal government at the expense of public universities’ 30 percent loss of their resources (Lerche Vieira, 1990; cited in Arnove et al., 1996). In case of Argentina, although most of its HE services are provided through public institutions like Uruguay, the University of Buenos Aires did not have enough resources to pay for full-time and exclusive professors and cannot spend sufficient amount of money for the students (Arnove et al., 1996; Ferreyra et al., 2017). On the occasion of Peru, by 1990, approximately 34 percent of all university students were studying in private ones and 41 percent of all universities were private (McLauchlan de Arregui & Salmón, 1992). Prominently, “private universities in Peru are only exceptionally directly subsidized by the State”6) (ibid: 26). On this account, to a large extent, private sector’s share in the total enrollment of Latin American HE increased from 7 percent in the 1950s to 40 percent in the 1990s (Torres & Schugurensky, 2002). Moreover, the share of private HE institutions in the region increased from 53.7 percent among 5,438 in 1995 to 69.2 percent among 7,514 in 2002 (Garcia-Guadilla, 2006).

Although there is a case like Cuba where HE is fully delivered by public institutions, privatization of HE system can be discovered in Chile, Brazil, Colombia, Mexico and most other countries in Latin America (Ferreyra et al., 2017). Neave & van Vught (1994) asserts that Latin American HE had been characterized by a state control model before the 1980s, but transformed into a state supervising model afterwards. For instance, Brazil, Colombia, and Chile went through a process of deregulation since the 1990s (Brunner, 1990; cited in Neave & van Vught, 1994).

(2) Financing scheme of universities and loans

Since the 1980s, ministries of finance in Brazil, Argentina, and Chile tried to inspire HE transformations to transfer the load of finance from public to private (Balán, 2006). Decrease of public spending towards HE imposes the burden to the students and the universities, in the form of tuition and profit generation, respectively. In practice, many free public universities did chase for mixed financing (Santos, 2004; cited in Muhr & Verger, 2009). In Peru, with the overlap of economic crisis direct transfers decreased and public universities were made to generate own sources of funding: the students had to pay for their diplomas when they graduate and they were recommended to do some ‘voluntary donations’ do their faculty (McLauchlan de Arregui & Salmón, 1992). In case of Chile, especially during Pinochet’s government (1974-1989), public spending to HE substantially diminished, which basically made students pay high tuition (Arocena & Sutz, 2005). Furthermore, public universities were forced to become ‘educational enterprises’ where market logic determined which courses to give or not, ultimately pursuing scholarship that can make profit as much as possible (Campbell, 1998; cited in Arocena & Sutz, 2005). Based on the recognition of diminishing subsidy from the government, private sector has been gradually becoming a crucial source of additional revenue in the universities in Mexico, and students and faculty were mobilized to fulfill this process (Johnstone et al., 1998). Delgado-Ramos & Saxe-Fernandez (2009) explains that powerful local elites accepted the WB’s HE privatization agenda in Mexico and since the 1990s, through its senators and deputies the private sector has permeated into education. Certain departments even made their own profits through sale of services or offering specialized courses (Johnstone et al., 1998).

World Bank (2002b) presents more examples. In the 1990s, the WB supported FUNDAYACUCHO, a public student loan agency in Venezuela, with a project to improve its financial sustainability and managerial efficiency. Although successful in terms of disbursements, the project’s impact was limited since it did not become a part of comprehensive reform of HE financing. However, in case of Jamaica, a similar operation had been done to the Student’s Loan Bureau. It has tried to improve financial status of HE through cost sharing conducted at the University of the West Indies and University of Technology. Also, Mexico has worked to establish student loan program that cover every private sector, following the WB’s recommendation (ibid).

(3) Competitive funds

World Bank (2002b) asserts that competitive funds can stimulate HE institutions’ performance and could be strong vehicles for innovation and transformation. Argentina’s Quality Improvement Fund has supported universities to be involved in strategic planning to strengthen existing programs and to create new interdisciplinary graduate programs. Consequently, faculties, which had never worked together gradually, started to cooperate in designing and implementing joint projects. Moreover, in Chile a second wave of HE reforms have been supported by a competitive fund to diversify – developing of the non-university sector – and to improve quality of all HE institutions. Mexico, Venezuela, and Brazil are trying to form high-class human resources in science and technology through competitive funds (ibid).

2) From the 2000s

Latin American HE policy development slowed down in the 2000s and this period is characterized by maintaining or combining previously introduced initiatives (Bernasconi & Celis, 2017). In this context, policies relatively focused on issues of equality or access to HE (CINDA, 2007; 2011; cited in Bernasconi & Celis, 2017). However, the WB’s neoliberal education reform agenda is maintained in terms of emphasizing the role of private sector or imposing user fees (Menashy, 2007). For instance, according to World Bank (2002b), the HE development should include expanding the production, qualified technicians and professionals through a cost-effective combination of non-university (both public and private) institutions. Moreover, it includes targeting investments in areas of advanced research and training, which can yield sizeable returns in the medium term (ibid). From the late 2000s to early 2010s, Latin America did expand student loan (Brunner & Villalobos, 2014; cited in Bernasconi & Celis, 2017).

2. Resistance from the Society

The WB’s neoliberal HE reform agenda and strategies focused on privatization were not always obediently accepted and applied. Arocena & Sutz (2005) assert that in regards to legal and financial dimensions of HE, the policies supported by the WB were implemented by several governments in the 1980s and 1990s, but were actually not well received by universities communities. Ferreyra et al. (2017) also explains that reforms in HE can be politically difficult in formulation and implementation due to conflicting interests among various stakeholders — faculty, students, industry, society in general, etc. — and ideological opposition. In fact, the WB did not pay enough attention to the political-economic aspects of HE reforms until the beginning of the 1990s. When coming to actual implementation of projects and programs, political reality of the recipient countries proved stronger than the technocratic vision (World Bank, 2002b). For instance, although it is aforementioned in part III of this paper that the WB tried to take political economy into account since the 1990s, the WB was not enough successful in supporting the implementation of reforms which were politically sensitive, such as transferring from negotiated budgets to formula funding, introducing tuition fees, and reducing subsidies (ibid).

Besides, introduction of neoliberal HE policy is not free from contradiction and various stakeholders’ resistance, especially the students. Student movements were mainly focused on preventing tuition increase or other privatization measures such as providing subsidy to private institutions through vouchers or public funds (Alcántara et al., 2013). In Nicaragua, university students and faculty protested against the national legislative executive branches of government’s attempt to reduce public allocations to nationally recognized universities (Arnove et al., 1996). At the end of the 1990s, in Ecuador, there was a resistance movement which criticized the economic policies that violated the social sense of universities. Argentina, Brazil, Colombia and Chile, recently with a stronger force, have joined these countries (Olivier, 2012). Also in Argentina, in 1995, tens of thousands of students, faculty, parents, and staff came out to streets and demonstrated to protest the New HE Law, which tried to implement tuition in public universities (ibid). There was a student occupation of the Autonomous National University of Mexico (UNAM) to oppose increase of tuition in 1999–2000 (Levidow, 2002). Some of these movements that expanded in the 1990s were even transformed into organizations such as the Social Network for Public Education in the Americas (Red SEPA), and the National Union of Educators of Ecuador (Olivier, 2012). Even in the 21st century, this tendency is being continued. In 2012, six hundred thousand Colombian students protested against increasing privatization of HE in the country (Jarvis, 2012).

Moreover, there were anti-neoliberal movements from newly elected leftist governments. Since 1998 until the late 2000, the leftist government came into power in the countries like Venezuela, Chile, Brazil, Argentina, Uruguay, Bolivia, Nicaragua, Ecuador, and Guatemala, of which the governments have made efforts to discard 40 years of continuing neoliberal policies, by increasing accessibility to HE and reducing tuition (Salvado Peralta & Pacheco, 2014). However, except for Venezuela7), most of the leftist governments ultimately failed because there were not enough resources to reduce HE tuition (ibid).


Regarding its recommendations to Latin America’s HE reform, the WB has claimed that although neoliberal orientation might seem opportunistic rather than idealistic, it would be the sole alternative to solve the status of austerity when it is becoming more and more difficult to collect taxes and to satisfy the public need (Johnstone et al., 1998). However, there are several side effects. This paper will briefly mention them due to limit of space. First of all, developing countries in Latin America were made to throw away what they had believed in. Latin American universities have been pressured to discard the main principles — autonomy and economic independence — established since Cordoba reform in 1918 (Torres & Schugurensky, 2002). The positive effects earned from expanding HE to previously ignored students from the late 1960s were ultimately weakened due to market-oriented policies (Arnove et al., 1996). It has been recognized that HE is a right of citizens and societal investment for several decades and this has been challenged by neoliberal agenda (Torres & Schugurensky, 2002). Castells (1996) even asserts that reduction in ‘dependency’ of Latin American countries, which was attained from the 1950s to the 1970s, was reversed in the 1980s and 1990s.

Secondly, it is hard to claim that HE inequality has reduced than before even though Latin American HE has been explosively expanded and accessibility of low-income students did increase8). As a case in point, students with income of the bottom 50 percent comprised of 16 percent of HE enrollment in 2000, 24 percent in 2012 (Ferreyra et al., 2017). Despite of this advancement, rate of access to HE in Latin America is 6 percent in the lowest income quintile, 70 percent in the highest (ibid). This shows that the gap between the rich and poor in terms of opportunity of HE has not been reduced. At this juncture, it is necessary to think about why there is a huge discrepancy between the WB’s agenda and policy and what is happening in practice.

Latin American HE has been exposed to various problems coping with worldwide change and it is impossible not to mention neoliberal ideology in that term. Neoliberalism had been an economic orthodoxy of developed countries and it has been exported to developing countries as an aid policy or a means to solve debt crisis (Simon, 2002). Segrera (2010) claims that HE institutions are formed not only based on the nation-state policy but also the global trend of capitalist system, and that external effect towards HE is much stronger than the change and transition which HE institutions could internally produce. This paper generally described how the WB has intervened in Latin America’s HE reform in terms of trend and agenda, focusing on neoliberal orientation and specifically privatization, and explained that although most of the Latin American countries did accept its recommendations, there were significant movements which counteracted them, as well. Since the 1980s, vivid in the 1990s, HE reform in Latin America was directed to reduce subsidies and to rely on private sector. However, several countries in the region made effort to promote feasible alternatives to neoliberalism in HE sector.

Although lots of scholarships draw the complexity of international organizations’ effect on HE reform in developing countries, there is a lack of empirical studies of HE policy formulation. It will be significant to see the detailed mechanism of how Latin American HE policy has been formed out of not only international organizations’ recommendations but also the societies’ resistance or values. For instance, Manky & Dolores (2021) suggest a perspective, which permits one to understand how actors related to Peruvian public universities were not against nor were victims of neoliberal reforms, but instead negotiated to deal with some of its dynamics. This implies that it actually could be difficult tending to be black and white, saying that one country solely ‘accepted’ or ‘refused’ neoliberal HE reform. Therefore it is recommended that what kind of mechanism work within one country in regards to neoliberalization’s effect on HE reform. Particularly, more research should be done regarding the countries besides high-income countries such as Argentina, Brazil, Chile, and Mexico, and this can be suggested as further research. Furthermore, international organizations’ neoliberal policy intervention towards the field of HE is not only confined to Latin American developing countries but also to Sub-Saharan Africa and Asia (Brock-Utne, 2003; Chou, 2008; Collins & Rhoads, 2010; Sifuna, 2014). Thus, it will be meaningful to discuss other developing countries’ stance and reaction about HE and to find a significant implication for international education development cooperation as well.


In case of Latin American, whereas IDB, USAID, and private foundations from the US were the main donors before the 1980s, the WB’s influence on HE increased since the 1980s (Balán, 2006). This is why this paper tries to limit the analysis to the WB.

The “Latin American Public Universities were expected to address and solve social problems by engaging in community outreach, contributing expertise to improve opportunities for disenfranchised members of society, and preserving local culture and traditions.” (Fischman & Ott, 2018: 87).

The idea that the private sector is more efficient than the public and ‘privatization’ is one of the principles imposed in neoliberal times (Palma Amestoy, 2021).

“Quality assurance is the systematic review of educational programs to ensure that acceptable standards of education, scholarship and infrastructure” (IEG, 2017: 130). Or it refers to “a public recognition of a certain level of quality of a program or an institution based on a self-assessment and an external evaluation (Ferreyra et al., 2017: 240).

Kwiek (2017) summarizes that HE privatization involves government’s diminishing role in provision, subsidy, and regulation. Patrinos (1990) defines that HE privatization includes expansion of private institutions, aiming cost recovery, relative effectiveness of private than public, decreasing public spending. However, in general, recognizing students as consumers and outsourcing services which were previously considered as the government’s duty, emergence of for-profit universities will be concrete examples for HE privatization (Kwong, 2000; Lyall & Sell, 2006). Olivier (2012) suggests that the HE privatization in Latin America accounts for five characteristics in common: 1) decrease of public spending on HE, 2) growth in the supply of private investment, 3) transfer of educational cost to the users or families of the system, 4) collection of fees, and 5) subjugation of academic activities to market forces.

Of course, the larger part of their resources is from tuitions, investments and donations (McLauchlan de Arregui & Salmón, 1992).

Although this paper did not cover ‘decentralization’, as previously mentioned it is also pointed out as one of the important aspects of neoliberal HE reform. In Venezuela, however, decentralization policies came into action, which were not typically neoliberal. One of them was to democratize HE by geographically locating traditional university infra to where people are actually living in the mid 2000s (Muhr & Verger, 2009).

Proponents of ‘privatization’ argue that, overall, private schools are far more effective in improving the cognitive abilities of people in developing countries (Psacharopoulos et al., 1986). They also say that ‘privatization’ has increased equity. This logic explains that an increase in cost recovery frees up more money, which can make primary education better in both quantity and quality, benefiting people with low income (Psacharopoulos, 1977). Although access has improved overall due to changes in HE in Latin America, there is still a gap in terms of equity. While it is true that private HE institutions attract students from higher income groups than public HE institutions, on average, both public and private HE institutions are now accepting more lower-income students than in the early 2000s. Furthermore, both public and private HE institutions are attracting larger proportions of students living outside the city. Despite their relatively low income, these ‘new’ students can finance their tuition through loans or scholarships at private universities, or through recent increases in family income (Ferreyra et al., 2017: 11). In this way, the expansion of HE in Latin America has improved access for the underprivileged. However, as the enrollment rate of students from low- income families rose, the enrollment rate of the group that had previously accounted for most of the enrollment rate also rose. In other words, there is no significant difference between the distribution before and after the expansion of HE. Latin American HE is still for the elite, and the majority of students come from high-income families (Holm-Nielsen et al., 2005). Education privatization may be beneficial at the school level, but there is no guarantee that it will do so for students (Kwong, 2000). Tuition increases may discourage the underprivileged from studying mathematics, and school promotions can increase enrollment rates, but can harm students by dispersing faculty time and energy. In particular, the strict admission policy applied by decentralized schools may allow only competent students to be selected at the school level, but students who do not meet the qualifications are inevitably excluded. This leads to systemic partitioning by establishing a more restrictive admissions policy for top-ranking or prestigious universities and a relatively accessible admissions policy for low-ranking universities (Torres & Schugurensky, 2002). In this regard, highly educated and information-accessible parents will use such resources to send their children to good schools located outside of their residential areas, leaving vulnerable students behind, resulting in slumping the area (Kwong, 2000). This is contrary to the ‘equivalence of qualifications’, one of the main goals of UNESCO’s HE policy (Segrera, 2015).



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