CHAPTER II Education and Economic Development

The belief, widespread and largely intuitive, that education somehow contributes to the improvement of a society has long been held. But in recent years, as the improvement of society has been more precisely de-fined, at least in the economic dimension, by governments and peoples explicitly seeking to raise their material standards of living, intuition and acceptance of that notion have not been sufficient. Clarification, under-standing, and formulation of reliable generalizations that could serve as a guide to policy in countries seeking modernization and industrialization have become highly important, even vital. The purpose of this paper is to examine the scholarly community's response to this need, which is repre-sented by the growing body of research that links education to economic growth and development. Substantial interest in the subject is reflected in the rapidity with which the terms human capital and human resources have been adopted, and in some cases reduced to slogans, in many parts of the world. It is also demon-strated by the increased amount of research that has accumulated in recent years. But interest in this relation is not entirely a recent phenomenon. At least since Adam Smith wrote The Wealth of Nations in 1776, some economists have recognized the concept of human capital (Vaizey, 1962). Nevertheless, although a profession full of disciples often invokes Adam Smith much as a deity, it must be recognized that concern for human capital and the role of education in its formation became real only in the mid-1950's. The body of research bearing on this field has been well summarize