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 Swampfox.com,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...
