Rapid advances in technology are nothing new; what is new in recent decades is rapid advances in the kinds of technology that require intellectual skills. This has increased the returns to people who have high IQs and good technical education. In addition, fulfilling Max Weber’s prediction that modernity would see ever more activities regulated by rational methods rather than by authority or personality, even low-tech activities, like management and marketing, have become ever more scientific, requiring a high level of intelligence.
High IQ and technical education are complements. But people who have modest IQs also benefit from education, as does society. Education even at its lowest levels helps to instill good work habits, respect for knowledge, simple communication and analytical skills, social skills, and civic values.
Every country, therefore, can benefit from having a good educational system, including pre-collegiate, collegiate, and postgraduate education. How to organize such a system and what the optimal level of resources to allocate to it is are of course difficult questions. There probably are diminishing returns to providing higher education, because IQ provides a ceiling beyond which educational effort is wasted on students. The
Developing countries face a chicken and egg problem in education policy. Until there is a highly educated stratum in a nation’s population, there will not be an adequate pool from which to draw teachers of technical subjects. But without such teachers the nation will be unable to create such a stratum—internally. Presumably the way for a developing country to proceed, therefore, is to send its brightest young people abroad for advanced education. Some will remain abroad but those who return to their native country will supply the elite teachers of the next generation. This by the way suggests that the teaching of English should be a priority for pre-collegiate education in developing countries, since the best universities are in English-speaking countries.
Developing countries, wisely from their perspective, are notoriously casual about enforcing intellectual property rights. They don’t produce much intellectual property themselves, and of course consumers of intellectual property would prefer not to pay for it as long as it continues to be produced in quantity despite their free riding. (Producers of intellectual property can actually benefit from free riding if IP “thieves” become a paying market for follow-on and complementary products, as often happens.) Appropriation of intellectual property becomes a means by which technical workers in developing countires can enlarge their technical knowledge and set the stage for innovation. So the priorities should be: first education and imitation, second innovation.
I would particularly stress the importance in developing countries of education in instilling civic values in a country’s youth, values that include honesty, respect for knowledge, tolerance, and, of perhaps greatest importance, loyalty to national institutions. Intense family and clan loyalties increase the cost and reduce the efficacy of government, foster nepotism and other forms of corruption, reduce social mobility, and undermine commercial values, which depend on impersonal markets. Modernity, which centrally entails a weakening of family and clan ties, is a precondition of economic progress, and education an important factor in promoting a modern outlook, quite apart from education’s role in developing technical skills.
Many developing countries are authoritarian, and their rulers may worry that education will loosen their grip on the population. On the contrary, it is more likely to strengthen it, by weakening family and clan loyalties that compete with loyalty to the regime.