Competitiveness and Education: The Challenge

Pablo Bereciartua – Executive Director, Centro de Estudios Estratégicos para el Desarrollo Sostenible (CEEDS)

12h05 – The room is full, we are still chewing our last bite from the coffe break and we are all set to start!

12h08 – Mr. Bereciartua greets the audience and starts his lecture by telling us the content of his presentation:

1. What are we talking about? what is happening out there?

2. What do we mean by Education and why is it important?

3. The knowledge economy: is it for everybody?

4. Summary & Conclusions

5. Q&A

Mr. Bereciartua keeps on going:

Through several graphs he introduces us to the actual situation in the world, data shows that there’s a swap between commodities and services on what represents competitive assets to a country.

This meaning that competitiveness is no longer just a matter of having plenty of natural resources (quantity) but of finding the way of making these resources last longer – actually, the richness provided by natural resources only last as such as the resources do, through productive processes that assure a long term sustainability, by finding new uses for such resources, and through added value to differentiate our product/resource from the others (quality, i.e.), etc.

2. What do we mean by Education and why is it important?

All definitions of competitiveness have to do with knowledge, furthermore through Solow’s growth model it’s proven that technology and human capital (i.e. education/knowledge) are key factors to growth.

More over, explains the speaker, we can talk about the “endogenous growth paradigm” where we’ll call “old wealth” to what resources you control and “new wealth” to what & how you control and develop your resources.

He continues showing data that indicates that human development and education development are strongly correlated.

3. The knowledge economy:  Is it for everybody?

Not few authors and studies, exposed Mr. Bereciartua, show an undeniable correlation between R&D expenditures and 1) higher GDP, 2) employment and 3) knowledge investment. Investing in knowledge, continues the speaker, shows positive effects in GDP increase, however this investment requires also the right social infrastructure and its “maintenance”. Well, he continues, numbers show it’s profitable to invest in knowlege but it’s still not done here. Actually the info shown in the graphs states that the LAC should invest from 2.5 to 10 times more of what is actually done.

Some ideas on how to create knowledge and social capital, would be:

• Increasing tertiary/university education in Science/Engineering

• Encouraging private R&D

• Reorientating present R&D towards aplied sectors – reform university incentives

• Creating networks through universities, firms linkages,  innovation clusters, international connections

• Promoting start-ups, venture capital

Bereciartua also commented on a new creative class, which is characterized by the 3T:  Talent, Technology & Tolerance, furthermore, he said, people that show any of these 3 features are particulary located in specific places: where the knowledge economy prospers! – this gives us a hint!

4. Summary & Conclusions

We are presented with the closing idea that the way to achieve a long term growth and thus less poverty, is through education. The later framed by institutions, a system of values founded on trust and social justice, the increase on the ability to deal with change, diversity and uncertainty. With this grounds we’ll be promoting a continuos value creation, thus growth and richness (creative capital).

Finally, Bereciartua summarizes that the big challenges ahead are a result of a changing world and its consequences, such as globalization, carrying capacity, uncertainty, new value creation paradigms: the knowledge economy. And he states that it is education the response to this challenge. The speaker develops on this: on how countries grow and prosper, human capital should be seen as a resource, social infrastructure is required to support the human capital because there’s a clear correlation between education and human development.

13h09 – Q&A

There was a good exchange time, between the participants and the speaker, with some critical, but still full of hope, conclusions where everyone assimilated that education gives a competitiveness advantage and means prosperity.

13h25 – Room gets empty as some of the attendees stay behind to have a word with the speaker.