Knowledge, Education and Competitiveness
in the 21st Century
As revolutionary as the shift from an agrarian economy to one based on manufacturing decades earlier, America's economy was being reshaped by new technologies and global competition at the end of the 20th century.
With the shift to a knowledge-based economy, more of a product's value was being added before and after the manufacturing. Companies employed fewer workers on assembly lines and paid an "educational premium" for well-educated professionals and managers who were adding the most value to products and services.
The United States was a world leader in the transition to a knowledge-based economy largely because it had a legal system that protected intellectual property; a school system that fostered creativity, not just rote learning; an environment that fostered entrepreneurship, including access to capital for starting new businesses; and world-class research universities.
As Alan Greenspan, chairman of the U.S. Federal Reserve Board, has said, "In a global environment in which prospects for economic growth now depend importantly on a country's capacity to develop and apply new technologies, our universities are envied around the world. If we are to remain preeminent in transforming knowledge into economic value, the U.S. system of higher education must remain the world's leader in generating scientific and technological breakthroughs and in preparing workers to meet the evolving demand for skilled labor."
What other issues should we consider?