Education, Income, and Equity in Malaysia

Abstract

This paper examines the returns to educational investment in Malaysia and their implications for public-sector resource allocation policies. These policies largely define the accessibility of educational facilities for most groups in Malaysian society, and since the resultant pattern of educational attainment impinges directly on personal incomes, attention will also be given to the distributional aspects of public investment in education. The focus of the latter will be upon urban-rural divergences, which in Malaysia touch directly on the question of racial equity. The indigenous Malays now constitute exactly one-half the total population but four-fifths of all rural residents; the Chinese account for just over one-third of the total population, but two-thirds of all urban residents are Chinese. (The remainder of the population is mainly of south Indian extraction and not notably concentrated.) A locational breakdown-if employed with proper caution-can therefore serve as a simple proxy for racial differences. This is the basic reason why existing economic imbalances in Malaysia are felt so keenly: urban-rural disparities are popular nowhere, but fairly extreme ones have been tolerated over long periods of time; racial disparities arewith good cause-universally regarded as more oppressive and less tolerable. The coincidence of economic imbalances by location and by race does not simply complicate the regional problems which Malaysia shares with virtually every nation in the world: it adds a whole new dimension.'