Eduction and Economy -- An Analysis of Statistical Data

The role of education and its relation to economy is a topic of increasing public and political concern. Within the European Union e.g. a series of conferences with the title "The European House of Education: Education and Economy -a new Partnership" has been initiated in the late nineties. The responsible ministers or their deputies of 32 countries discuss this subject together with representatives of the business sector with the intention to pave the way for adjusting the education system to the needs of the society. The topics covered are concepts how to cope with the necessity of acquiring new qualifications, skills as well as further competence requirements for the information and knowledge based societies 1 . Rapid changes in the scientific, technological and economic environment in an increasingly interdependent world challenge existing educational systems worldwide. The consequences for education obtained via institutional systems such as schools and universities are seen in the necessity to get arranged with this steadily moving target. The inherent boundary conditions of these systems of being slow by nature make changes to meet the current requirements even more difficult. The concepts discussed controversially range from a new balance whether either personality development or skill acquisition dominated education should be at the core to a reinterpretation of the demands for internationality in terms of the necessity of language skills and mental openness to the different cultures of the economic players at the world level. Furthermore, education has to fulfill the task to teach people qualifications and skills which are in demand of the labor market. Access to timely, accurate, and diverse sources of knowledge is regarded as a major foundation of human development and as essential to stimulate economic growth, slow down population growth, build strong communities, and encourage democracy. Consequently, the acquisition of knowledge at all levelsprimary, secondary as well as tertiary education schemes -is the essential ingredient to enable the population of a country to participate in the progress offered by the technological transformations of the 21st century. In this context, attempts to quantitatively measure the results of school education in the view of societal demands play an important role and enable the governments to focus on their comparative advantage/disadvantage at the level of countries and regions. Recently, several studies -like PISA 2 and TIMSS 3 -have been published, comparing the performance of students of different OECD countries after 4 years and 8 years of schooling, respectively. They result in an unexpected strength of some Asian countries (Korea, Japan), New Zealand, and North Europe (Finland). These studies have generated much political concern about the future of those countries with low or average marks. The consequence was a public debate about the importance of education as the base of any economically successful society. In that context, the role of education in natural science and math has been revisited and was regarded as the fertilizer for success in the increasingly interdependent world economy driven by innovation. The general discussion whether there is a causal connection between education and the level of macroeconomic performance of a country is much older than this debate. The correlation between economic strength, general education and education in science has frequently been postulated and these claims have been supported by a plethora of case studies 4,5,6 . The US National Center for Education Statistics (NCES) published 1997 an extensive study 7 based on an indicator analysis and linked the productivity of the US work force to the worker's education and skills. In this study, growth in education appears to be a substantial contributor to productivity growth, accounting for an estimated 10-20% of the growth of the gross domestic product [GDP] in the recent decades. Studies of comparative international economic growth consistently use education indices in their models to underpin the empirical findings. In labor economics e.g. it has been postulated that there is a substantial nexus between the performance of students, the quality of the educational system and economic competitiveness 8 .

Complementary to these studies, focusing either on single elements of the complex relation of economy and education (e.g. the relation between internet use and economic performance) or the national aspects, only, in this paper an independent, more analyticalquantitative global approach is attempted. The aim of this study is a comparative investigation of indices describing the macroeconomic situation and perspectives of a country with those relevant for human development, education, and technological achievements and to find correlations between them. It is based on statistical data published by the OECD 9 and the United Nations Industrial Development Organization

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