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EU-India Seminar
Reasons and Policies to Promote Lifelong Learning: the EU Experience
Friedhelm Pfeiffer, University of Mannheim & ZEW Mannheim
New Dehli, India 28 November 2006
“The most valuable of all capital is that
invested in human beings;
and of that capital the most precious part is the
result of the care and influence of the mother”
Alfred Marshall (1890, VI.IV.11)
Dimensions of Human Capital
cognitive cognitive skillsskills
mobilitymobility
Friedhelm Pfeiffer
non-cognitive skillsnon-cognitive skills
The “Technology” of Lifelong Learning
Friedhelm Pfeiffer
Sensitive or critical periods (evidence form other disciplines: neurobiology, developmental psychology)
Skills acquired in one period are available in later periods (self-productivity, recursive productivity)
Early investments yield the highest returns
Skills acquired in one period enhance the returns of later investments (direct complementarity)
Further investment is necessary („lifelong learning “)
Determinants of Lifelong Learning
Genetic endowment
Friedhelm Pfeiffer
Mother, family background
Peer groups
Educational institutions
Firms
Labor market
Cognitive Skills
Memory of the brain, speed of information processing
General capacity of solving problems
Mathematical knowledge, etc..
Friedhelm Pfeiffer
roughly 80 %80 % of the cognitive skills are formed up to the age of
six years (or even earlier)six years (or even earlier) Family background is crucial
Non-cognitive skills
Motivation
Social Integration
Self-regulation („delay of gratification“, „resistance to distraction“)
Friedhelm Pfeiffer
roughly 70%70% of non-cognitive skills are acquired in the first 20 20
yearsyears Family background and schooling are crucial
Cognitive and Non-cognitive Skills over the Life Span/ Interventions
Friedhelm Pfeiffer
900
450
0
0 8 16 24 32 40 48 56 64 72 80
Basis
Impulse 0 to 6
Impulse 12 to 18Impulse 45 to 51
Age [years]
900
00 8 16 24 32 40 48 56 64 72 80
450
Age [years]
Cognitive skills Non-cognitive skills
A Population of Heterogeneous Individuals Cognitive skills
1,000
750
500
250
0
0 8 16 24 32 40 48 56 64 72 80Age (years)
99. Perzentil90. Perzentil75. Perzentil50. Perzentil25. Perzentil10. Perzentil1. Perzentil
Non-cognitive skills1,000
750
500
250
0
0 8 16 24 32 40 48 56 64 72 80Age (years)
Friedhelm Pfeiffer
Returns to Investments in Skills of Individuals from Favourable or Disadvantaged Environments
High cognitive skills Low cognitive skills
1,000
500
0
0 8 16 24 32 40 48 56 64 72 80
Basis
Impulse 0 to 6
Impulse 12 to 18
Age [years]
1,000
500
00 8 16 24 32 40 48 56 64 72 80
Age [years]
Mobility
Law of increasing reductions in regional distance costs
Occupation
Employer/ Firm
Activity/ Job
Highest mobility after finishing school
Friedhelm Pfeiffer
The availability of attractive jobs is important
Mobility explains roughly 40% of the variance of wages
Simulation Model
Cognitive skills = f (cognitive skills in the previous period, non-cognitive skills in the previous period, investment, learning ability, depreciation)
Friedhelm Pfeiffer
Non-cognitive skills = g (cognitive skills in the previous period, non-cognitive skills in the previous period, investment, learning ability, depreciation)
Human capital = h (human capital in the previous period, cognitive and non-cognitive skills, depreciation)
Skill Formation over the Life Span
1 1 1C N t 13 3 3
t t 1 t 1 t 1 t 1 H
t 1
HH S S H H
v
Friedhelm Pfeiffer
Human Capital
80,000 €
60,000 €
40,000 €
20,000 €
0 €
0 8 16 24 32 40 48 56 64 72 80Age [years]
Basis
Impulse 0 to 6
Impulse 12 to 18Impulse 45 to 51
Equality of Opportunity and Lifelong Learning
Equality of opportunity has deep roots in Europe (for example French Revolution 1789-1799, Martin Luther 1483-1546: access to education for all)
Friedhelm Pfeiffer
Social partnership is important
Significant variation of educational institutions and the role of social partnership in European countries
The Heterogeneity of Skills in Europe
Friedhelm Pfeiffer
Source: OECD (2006), own calculations
Finnland Germany Portugal Finnland Germany Portugal
5% 400 295 311 0.73 0.57 0.2810% 437 341 351 0.89 0.74 0.3825% 494 419 418 1.18 1.06 0.6250% 543 491 478 1.46 1.41 0.8975% 599 572 544 1.83 1.85 1.2790% 641 624 592 2.14 2.16 1.6195% 666 652 617 2.33 2.34 1.80
PISA Reading 2003 Human Capital in Million €1€ = 58 Rupie
Impacts of Training Programs for Adults
Target population and program dose (intensity)
Friedhelm Pfeiffer
Indirect undesired effects sometimes large
The effects of government educational programs for adults sometimes are ambitious (alternatives should be discussed)
Fostering mobility after finishing school, social partnership and the creation of work
Friedhelm Pfeiffer
Labour market competition due to migration and globalization
Two sides of one coin: lifelong learning and technical progress
Neurobiology: childhood is crucial for the ability of lifelong learning