Paying the Price for a Dumber Generation

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Paying the Price for a Dumber Generation

Lawrence Katz and Claudia Goldin of Harvard University recently published a book called The Race between Education and Technology.1  The title derives from the work of Jan Tinbergen, winner of the first Nobel Prize in economics.  In his work in the 1970s, Tinbergen pointed out that changes in technology drive the demand for new skills, while the supply of those skills is driven by education.  The difference in what people earn varies with education, and Tinbergen pointed out that the differences in real wages could be explained on the basis of the race between the demand and supply of skills, or alternatively between technology and education.  Education, in other words, is always trying to catch up with the latest technological innovation to supply the skills that industry needs

As Katz explained in a radio interview with Vox Talks,2 during the first half of the 20th century, the United States created universal access to high school when much of the world didn't even enjoy a grade school education.  During that period, there was a marked narrowing of wage inequality, because more people had the skills needed to master the technologies of the times. 

The rapid development of new technologies combined with this universal access to education, and resulted in a stable wage structure and widespread prosperity from about World War II until the 1970s. 

But since that time, technology has continued to advance rapidly, while the increase in the average American's educational level has slowed.  To understand the implications, we need to examine the underlying trends in more detail.

Let's start with technology.  Today's technologies are so complex that high school is not enough.  As pointed out in a recent article on the Web site,3 there are fewer than half a million mathematicians and statisticians in the country.  However, there are almost four million professionals, such as doctors, engineers, and computer professionals, who need the same level of math and science in their educational background to be competitive in their fields. 

How well they do in college math and science is directly related to their experience in high school, especially in advanced placement courses.  Those courses are not serving them well enough to keep up with the demands of advancing technology.  For example, doctors now need not just biology but also computer science as part of their training...

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