[Inside Chodong] Is It Fair to Enter Prestigious Universities Based on Parents' Wealth?

Changhwan Lee, Deputy Head of the Economic and Financial Department

The topic that heated up the National Assembly audit of the Bank of Korea held last week was the reform of the college entrance examination system. It is unusual for a topic other than the Bank of Korea's main responsibilities, such as monetary policy or inflation, to receive attention during the audit.

This is because the Bank of Korea made a rather shocking claim in its August report titled "Social Problems Caused by Overheated Entrance Exam Competition and Countermeasures," stating that universities should select students in proportion to the number of school-age population by region.

As the overheated competition for college entrance has caused various social problems such as inheritance of wealth, rising housing prices, low birth rates, burden of private education, and decline in social dynamism, and previous institutional reforms have been ineffective, the Bank of Korea proposed a more extreme solution. The Bank especially expressed concern about the excessively high proportion of wealthy students living in the Gangnam area among Seoul National University entrants and emphasized that prestigious universities should take the lead in introducing a regional proportional selection system.

Universities are generally negative about the Bank of Korea's proposal for a regional proportional selection system. Seoul National University acknowledged some points of agreement with the Bank's claim but stated that it is realistically difficult to implement under the current entrance exam system. Yonsei University and Korea University are also reported to have told the National Assembly that it is premature. During this Bank of Korea audit, lawmakers raised doubts about the feasibility of the system proposed by the Bank, given the universities' negative stance.

However, Lee Chang-yong, Governor of the Bank of Korea, went a step further and said that universities selecting students based on academic scores may not necessarily be "fair." He reiterated that universities should actively reform the entrance exam system, even if it means changing their mindset a little.

When Governor Lee's remarks about fairness in college entrance exams were reported, many concerned and critical comments were posted. There were many harsh criticisms such as, "Isn't this reverse discrimination against people living in Gangnam?", "Entering university through a transparent exam is the fairest," "Is this coming from someone who lives in Gangnam but sends their children to overseas schools?", and "Stop worrying about entrance exams and do your job properly at the Bank of Korea."

However, the social reflection on fairness in college entrance exams that Governor Lee mentioned is absolutely necessary. Currently, our society has reached a situation where college entrance results vary depending on parents' wealth, and wealth inheritance occurs through this.

This is well shown in the Bank of Korea report: students from the Gangnam 3 districts, where income levels are high and private education is active, account for only 4% of all general high school graduates nationwide but make up 12% of Seoul National University entrants. One might argue that students living in Gangnam are smarter and work harder. However, when comparing students with the same learning ability and potential, those whose parents have more wealth and who live in better neighborhoods have a 1.9 times higher chance of entering a good university than other students.

Ultimately, if we are to talk about fairness in attending prestigious universities based on academic scores, it is time to address whether receiving good private education and studying in better environments due to parents' abilities should also be included in the concept of fairness.

The Bank of Korea and Governor Lee's claims are meaningful in that they fundamentally reflect on the reality where children who meet good parents, attend prestigious universities, get high-paying jobs, inherit much, live again in Gangnam, fuel the private education frenzy, drive up housing prices causing excessive household debt, and break the ladder of social mobility.