Paper presented by Prof. Cunningham at the joint European Commission-MIT Round Table on Globalisation of the Knowledge Economy, Massachusetts Institute of Technology, USA.
Paper presented by Prof. Cunningham at the joint European Commission-MIT Round Table on Globalisation of the Knowledge Economy, Massachusetts Institute of Technology, USA.
Date: 01 February 2008
Patrick Cunningham
Trinity College Dublin, and Chief Scientific Adviser to the Government of Ireland
A key measure of the commitment of a country to building the knowledge economy is the proportion of its population that are educated through University level institutions.
By this measure, the US has a strong head start: for over 30 years nearly 40% of its adult population have had tertiary education. European countries vary, but most are now achieving similar (or better) rates of higher education, while in the US third level participation rates seem to be levelling off.
A second measure of commitment to the knowledge economy is the level of expenditure that a country is prepared to make for third level education. On this measure, the most recent OECD statistics show an average spend across the OECD of about 1.5% of GDP. This amounts to about $12,000 per student. In the US, average expenditure per student is almost twice this figure, while European countries vary around the average. There are also dramatic differences between EU and US in the source of the expenditure. In European countries, about 90% is covered from public funds, while in the US less than 40% is paid from public funds.
There is also considerable transatlantic difference in the way in which this expenditure per student is allocated. The OECD statistics differentiate expenditure on education from that classified as research and development. On average, for 19 EU countries, 31% of expenditure was on R&D, while in the US the figure was 12%.
Does higher expenditure mean higher performance? In the first five years of this century, real GDP growth averaged 2.6% per annum in the US as against 1.4% in the Euro area. This confirms the picture of a more innovative, dynamic economy on the American side. Investment in higher education and research is acknowledged to be a major driver of wealth creation in society, though it is difficult to quantify the chain of causes and effects. One indirect (and admittedly less than satisfactory) measure of University contribution is the quality of the Universities. The two most widely quoted measures are the Shanghai Index and a somewhat similar performance ranking system used by The Times Higher Education Supplement (THES).
Compared to US Universities (given an average score of 100), Universities in European countries varied from less than half to more than twice the US level (Shanghai data). Average University rankings in Sweden, Denmark, Netherlands, UK and Belgium were all above those in the US, while for most other countries in Europe the ranking was below. There was also, among the European Universities, a reasonably clear relationship between expenditure per student and average performance of the Universities in a country. The US was exceptional in that expenditure per student was twice that in Europe, but overall University ranking was intermediate.
Turning to the THES rankings for 2007, most of the top 200 ranked Universities in the world were in Europe (86) or the US (57). When all these Universities are classified into ranking groups, we find that US Universities dominate in the upper rankings (by 4 to 1 in the highest ranked group).
Despite the very different history and societal structures of the US and the EU, within each there is enormous variation in the structure, funding and performance of the University sector.
In the US there is a fairly clear two-track system. About 75% of the country’s students attend public institutions, which in many respects are similar to those in Europe. However there is an extraordinary concentration of wealth and talent in the elite Universities: The Ivy Plus Group. While they educate less than one percent of all students in the country, they have access to enormous resources. The top ten have endowments of $126bn (of which Harvard and Yale have $57bn). All-inclusive fees are about $45,000 per year, though many students can avail of University funded scholarships. These elite Universities are of course largely graduate schools. In 2006/7, they had 125,000 students of whom 45% were already graduates. Collectively, their graduate student numbers have increased by 10% in the last decade while their undergraduate numbers have been in net decline.
The European pattern is a much more egalitarian one. While there are no institutions with resources comparable to those of the American elites, Europe still has 86 out of the top 200 Universities on the THES ranking.
There is substantial reform and reorganisation underway in many EU countries, most recently and notably in France. Much of the change proposed is in an American direction, towards more institutional independence and competition. Furthermore, there is growing effort to improve European society, in addition to increasing its wealth, through collective actions undertaken by the European Union.
The Erasmus programmes fund more than 150,000 inter-country student exchanges per year. The Marie Curie programme for graduate students benefits some 5,000 researchers annually. The new European Research Council will fund over $1b worth of projects per year, while overall EU supported research will be funded at the level of $10bn per year.
For the most part, the challenges we face are also the opportunities. At the very broadest level, global society in the coming generation must develop and deploy technologies needed to protect life on earth: to moderate climate change, to make the transition to totally renewable energy, to mitigate and reverse environmental damage, and to approach an equilibrium in global population with increasing fairness of access to the necessities of life.
The University sectors on both sides of the Atlantic face a number of challenges:
- Balancing equity, particularly of access, with the drive for performance of institutions.
- Better harvesting (and measurement) of the benefits of higher education and research for society.
- Balancing the drive for economically measurable outputs with those which contribute in less measurable ways to enlightenment and civility in society.
- Using the competition in knowledge creation and use, which currently exists between the large economies of the world and will increasingly have to contend with competition from the new giants, to advance peace, friendship, equity and security in the world.