Korea's Market for Private Education

The scale of Korea's education market is mind blowing: "Nearly three of every four South Korean kids participate in the private market. In 2012, their parents spent more than $17 billion on these services. That is more than the $15 billion spent by Americans on videogames that year, according to the NPD Group, a research firm."

Great teachers build brands and the WSJ article highlights one teacher who employs 30 people and manages to make more than $4 million (USD) a year. Interestingly it points to private market solutions to our public education system dilemma - but it's also one that highlights how bad Koreans think their public education system is (WSJ):

But are students actually learning more in hagwons? That is a surprisingly hard question to answer. World-wide, the research is mixed, suggesting that the quality of after-school lessons matters more than the quantity. And price is at least loosely related to quality, which is precisely the problem. The most affluent kids can afford one-on-one tutoring with the most popular instructors, while others attend inferior hagwons with huge class sizes and less reliable instruction—or after-hours sessions offered free by their public schools. Eight out of 10 South Korean parents say they feel financial pressure from hagwon tuition costs. Still, most keep paying the fees, convinced that the more they pay, the more their children will learn.

For decades, the South Korean government has been trying to tame the country's private-education market. Politicians have imposed curfews and all manner of regulations on hagwons, even going so far as to ban them altogether during the 1980s, when the country was under military rule. Each time the hagwons have come back stronger.

"The only solution is to improve public education," says Mr. Kim, the millionaire teacher, echoing what the country's education minister and dozens of other Korean educators told me. If parents trusted the system, the theory goes, they wouldn't resort to paying high fees for extra tutoring.

To create such trust, Mr. Kim suggests paying public-school teachers significantly more money according to their performance—as hagwons do. Then the profession could attract the most skilled, accomplished candidates, and parents would know that the best teachers were the ones in their children's schools—not in the strip mall down the street.

Schools can also build trust by aggressively communicating with parents and students, the way businesses already do to great effect in the U.S. They could routinely survey students about their teachers—in ways designed to help teachers improve and not simply to demoralize them. Principals could make their results far more transparent, as hagwons do, and demand more rigorous work from students and parents at home in exchange. And teacher-training programs could become far more selective and serious, as they are in every high-performing education system in the world—injecting trust and prestige into the profession before a teacher even enters the classroom.