Importance of Education for Economic Development

Education can be seen as an investment in the knowledge and skills of the population from an economic point of view. Education equips people with the skills that will make them more productive in doing their job. It also imparts the knowledge and skills that enable people to develop and apply new ideas, which in turn generate innovation and technological progress.

To the extent that skills, knowledge, and competencies increase individual productivity, better-educated people will have higher incomes and will be less at risk of unemployment. At the level of the economy as a whole, education can fuel the long-term economic growth of local businesses saskatoon by increasing macroeconomic productivity and by helping.

Business: Education and Individual Wealth

Better education pays off not only for society as a whole but also for every individual. From an individual perspective, the higher the educational level, the lower the risk of unemployment and the higher the earned income. A good education is the best insurance against unemployment.

Starting points for business educational policy

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Given that good education plays a key role in economic prosperity, the question arises of how politics can effectively increase the educational performance of the population. An extensive literature almost uniformly comes to the result that mere reductions in class sizes and other additional expenses hardly improve student performance given the given institutional framework.

In an international comparison, there is no connection between the level of expenditure and the measured student performance. The best countries no longer spend systematically. For example, Finland does not spend more per student than Spain or Italy, but it does much better in performance comparisons.

All in all, a good education is a central factor for individual and social prosperity. Economic growth, employment, satisfactory income, and the prevention of poverty – and thus the financial viability of the social security systems and the achievements of the social market economy – stand and fall with the knowledge and skills of the population.

Ignoring the economic dimension of education would therefore endanger the prosperity of future generations. That is why an education policy that ensures that all people can achieve the best possible skills is the best social and economic policy.