Education and the Economics of Growth

In their recent book, Eric A. Hanushek and Ludger Woessmann advance the simple argument that long-run economic growth is overwhelmingly a function of the cognitive skills of the population, or the "knowledge capital" of a nation. This hypothesis is subjected to rigorous economic and empirical analysis including extensive consideration of causal interpretations. The main results are remarkably robust, and equally applicable to developing and developed countries. Two largely unsolved historical mysteries – the "Latin American growth puzzle" and the "East Asian miracle" – are completely explained by consideration of knowledge capital. The central importance of cognitive skills allows one to calculate the economic benefits of improved skills for individual countries of the world. The historical consequences of increased knowledge capital prove to be huge – multiples of GDP for achievable improvements in schools.

Mr Hanushek will be visiting CESifo from 15 to 21 November. No stranger to CESifo, he is both Research Professor at the Ifo Center for the Economics of Education as well as Director for the Economics of Education Area of the CESifo Research Network. He has also served on Ifo's Scientific Advisory Council. His frequent visits to CESifo are aimed at increasing the interaction among researchers in the economics of education on both sides of the Atlantic.

Eric Hanushek is a senior fellow at the Hoover Institution of Stanford University. He received his PhD in economics from MIT and is a distinguished graduate of the United States Air Force Academy.