On Current Account Balance and Dual Education System

Recently I was often debating in an international environment on how a good education system might look like. As an advocate of the dual education system I needed some statistics to show its superiority to an only university based system.

To this I worked out a simple table with data from Wikipedia. Without a demand for correctness it shows a correlation between the current account balance and the type of education of a country.

Rank Country1 Population2 CAB3 Oil4 CAB/C5 Oil/C6 CAB/C-Oil/C7 Dual8
1 Luxembourg 511’800 3.40 0 6’635.40 0.00 6’635.40 -
2 Switzerland 7’952’600 49.35 3’488 6’205.52 12.81 6’192.71 yes
3 Netherlands 16’736’075 46.69 57’190 2’789.78 99.78 2’690.00 (yes)
4 Sweden 9’495’113 21.68 4’833 2’283.28 14.86 2’268.42 -
5 Germany 81’859’000 149.30 156’800 1’823.87 55.93 1’767.94 yes
6 Denmark 5’584’758 14.35 262’100 2’569.49 1’370.39 1’199.10 (yes)
7 Austria 8’452’835 9.90 21’880 1’171.20 75.58 1’095.62 yes
8 Japan 127’610’000 122.80 132’700 962.31 30.36 931.94 -
9 Finland 5’410’810 4.70 8’718 867.89 47.05 820.84 -
10 Israel 7’879’500 6.27 3’806 795.61 14.10 781.50 -
11 South Korea 48’580’000 36.35 0 748.25 0.00 748.25 -
12 Iceland 320’060 0.04 0 131.23 0.00 131.23 -
13 Belgium 10’951’266 1.13 11’220 103.09 29.92 133.01 -
14 Hungary 9’962’000 2.13 21’430 213.61 62.81 276.43 -
15 Poland 38’501’000 15.90 34’140 412.98 25.89 438.87 -
16 Czech Republic 10’504’203 5.96 10’970 567.01 30.49 597.51 -
17 Ireland 4’588’252 3.19 431 695.47 2.74 698.21 -
18 Mexico 112’336’538 7.00 3’001’000 62.31 780.06 842.37 -
19 France 65’350’000 77.88 70’820 1’191.71 31.64 1’223.35 (yes)
20 Italy 59’464’644 74.30 146’500 1’249.48 71.94 1’321.42 -
21 Spain 46’185’697 60.90 27’230 1’318.59 17.22 1’335.81 -
22 New Zealand 4’432’630 4.50 61’150 1’016.10 402.83 1’418.93 -
23 Norway 5’016’700 60.23 2’350’000 12’005.90 13’678.31 1’672.41 -
24 United Kingdom 62’262’000 66.60 1’502’000 1’069.67 704.42 1’774.09 -
25 Greece 10’787’690 19.89 6’779 1’843.77 18.35 1’862.12 -
26 Australia 22’930’253 30.40 589’200 1’325.76 750.30 2’076.06 -
27 Portugal 10’561’614 22.61 4’721 2’140.77 13.05 2’153.82 -
28 United States 313’710’000 599.90 7’800’000 1’912.28 726.02 2’638.30 -
29 Canada 34’824’500 52.60 3’289’000 1’510.43 2’757.79 4’268.22 -
  1. Some OECD countries
  2. Population: http://en.wikipedia.org/wiki/List_of_countries_by_population
  3. Current Account Balance in Billion $: http://en.wikipedia.org/wiki/List_of_countries_by_current_account_balance
  4. Oil Production Barrel per Day: http://en.wikipedia.org/wiki/List_of_countries_by_oil_production
  5. Current Account Balance per Capita in $
  6. Oil Production per Capita per Year in $ assuming 80$ per Barrel
  7. Current Account Balance per Capita – Oil Production per Capita in $
  8. Education System according to: http://en.wikipedia.org/wiki/Dual_education_system

Method

  • First of all I started with a list of 29 OECD countries and their population.
  • Then I added for every country its current account balance.
  • The first important step is to calculate the current account balance per capita. Just by this we see how valuable the goods are a citizen of a specific country is able to produce. This ranking (column 5) would already be enough for the analysis.
  • Since some countries (in the OECD case mainly Norway) profit from a good they mostly get for free (oil, gas), we got a list with the oil and gas production of a country, calculated how much this is per capita a year (column 6, actually an interesting ranking itself) and subtracted this from the CAB per capita value which results in the final ranking (column 7). Assuming that every country needs the same amount of oil per capita, this is actually a quite fair way to get oil and gas out of the CAB calculation.

Interpretation

We see that the existence of a dual education system and the value of a countries product on the world market do correlate. This is does not mean that they are in relation somehow, but nevertheless it helps in some debates.

Additionally I am aware that I do not know how the educations system in all these countries really work; I just took the values from the Wikipedia article (dual/non dual) and added them to the ranking. An in detail analysis would surely lead to more accurate results.

This table also helps to understand many other things that happen in the world, e.g. why currency exchange rates change or it is one reason why the Euro crisis exists.

Some Examples

  • Germany has a CAB of 149.30 billion $ per year. Since it has 81’859’000 people, each person exports 1’823.87 $ more per year than it imports. Having that the country provides oil and gas for about 55.93 $ per capita, it ranks a final value of 1767.94$.

Comments

  • The actual winner of the ranking would be Singapore with a score of approximately twelve thousand dollar. See the full list: CABandEducationWeb
  • Unfortunately the oil production values do include ”refinery gains from domestic or imported petroleum production”. Hence also non oil or gas drilling countries like Switzerland do have a little amount of oil production. Nevertheless, it is such a small amount in comparison to Denmark, Mexico, New Zealand, Norway, UK, Australia, USA and Denmark that in general this is not a problem.
  • Its interesting to see that a high oil production correlates with a negative CAB/C (even when not subtracting oil production).

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