<p>From the Economist Oct 28th, 2005. Print version. Drat.
**Closing the Growth Gap **</p>
<p>*In the past ten years, the economies of what is now the euro area have grown by around 2% a year. Amercian has managed a full percentage point more…Growth theory is good at explaining why rich countries are rich and poor ones poor, but much less so at divining why some rich countries (eg. America) grow faster than others (eg. much of Europe) and telling the laggards how to catch up.</p>
<p>A recent paper by Philippe Aghion of Haravard Univsiity, and Perter Howitt of Brown univiersity, attempts to fill the spaces between theory and policy…</p>
<p>(One) angle identifies innovation as the fuel for economic advance…Aghion and Howitt argue that… Europe, having grown faster than America for 30 years after the second world war, stopped clsoing the gap and fell farther behind (in the last decades)…</p>
<p>In countries already at the cutting edge (of technology), innovation is the source of growth. Those not at the frontier advance by implementing existing, but still better methods of production…</p>
<p>The closer a country is to the technoligical frontier, the more growth depends on a highly educated workforce…</p>
<p>America spends 3% of GDP on tertiary education; the European Union only 1.4%. More than a third of Americans have degrees, fewer than a quarter of Europeans do. Against that, many European countries have stronger secondary education than America does…but (Europe) did not adopt the (educational) policies needed to push back the technological limits.*</p>
<p>**The usual PC CC caveats apply to these excerpts.</p>
<p>I don’t believe this is true! I have a freind who now lives somewhere in south Jersey–goes by the name of Bob–who did not go to college or take AP classes (he was really dumb in a dumb way), and I friend of mine’s cousin, Jacques, lives in France and he’s in college…and France!–seems like a pretty smart guy.</p>
<p>I think of this closing gap as a means of Development.</p>
<p>In terms of Industrialization, Europe is farther ahead than America and is probably in like Stage 5 development, in which the population is decreasing and industry isn’t necessarily thriving as it has before.</p>
<p>In contrast, the United States is proabably in Stage 4 Development and its population is still growing and the economy is still growing, relatively speaking.</p>
<p>Now Europe’s industrialization began before America’s industrilization and I think America will eventaully be like Europe today.</p>
<p>:) Loved that Woodwork. Interestingly, I lvie in a nation where lesss that 25% of adults have tertiary education and there is, in fact, an enormous difference in social attidtudes twoard such tertiary education. For example, alhtough a student can get a worthy BA in 3 years for approximately US $18k, even wealthy parents refuse to pay those fees. The students must borrow the funds from the government at unsubsidized 7% rates. </p>
<p>Also, pursuing higher level of education is seen as ‘getting above yourself, who do you think you are?’ If my neighbors knew what Americans pay for 4 years of Private US U, they’d probably spit the dummy!</p>