The Economics of Gifted Education


Some 20 years ago I completed an Advanced Diploma in Educational Administration and the Economics of Education at the University of London Institute of Education.

Ten years on, when I first took up responsibility for G&T education, I was astonished to discover that there was no substantive academic research in the economics of gifted education. This seemed odd given the strong emphasis during my course on the value of human capital.

Human Capital

Human capital is the collective term for the knowledge, skills, understanding and personal attributes that equip a person to generate economic value.

Much of this capital is typically acquired through education, an investment that generates financial and non-financial benefits (known as externalities or spillover benefits) to the individual and to society:

Private returns Social returns
Financial benefits Higher salaries Increased tax revenue
Spillover benefits Better healthImproved life expectancy Reduced crime ratesBetter social cohesion

I did not expect to find any work on the private returns to participation in gifted education programmes. It would be hard to isolate the benefits from those of compulsory education, and to undertake the necessary longitudinal studies comparing participants against a robust control.

But I did expect the cognitive skills of G&T young people to be recognised as a valuable commodity; their development seen as an important investment in national economic competitiveness. And I anticipated some recognition of the role of gifted education in treatments of the contribution of human capital to economic growth.

New economic growth theories

Endogenous Growth Theory became fashionable shortly after I completed my course. It gives significantly greater emphasis to the macroeconomic benefits of investment in human capital and the significance of technological progress.

According to this theory, as I understand it, investment in human capital brings about innovation, improves the efficiency of production and results in better products and services.

This generates increasing returns and so brings about continuous long-term improvement in economic growth. That is the theory, at least, though empirical studies have not always demonstrated this in practice.

But I can find very little reference tothe benefits of gifted education in any empirical studies. This might be explained by the difficulty of identifying and quantifying the numerous components of human capital, whether within compulsory education, tertiary education or CPD. Or it might be because gifted education benefits only a relatively small minority of the workforce, so is perceived to have a relatively small impact.

The complex nature of human capital is conveyed by the OECD’s work, which identifies four different types, the first two typically associated with academic study, the last two with practical experience:

  • Know-what – or factual knowledge such as that required by lawyers and doctors in order to practise;
  • Know-why – the scientific knowledge that underpins technological development and which typically resides in universities and research laboratories;
  • Know-how – the skills or capability required by employees relating to their role and typically maintained within each company or business;
  • Know-who – access to networks that support the sharing of know-how, know-why and know-what.

Knowledge-based Economies

Regardless of the mixed conclusions from empirical studies, modern growth theory has led many countries to develop plans for their transformation into Knowledge-based Economies (KBEs).

This term has been applied to many smaller Pacific Rim states (Hong Kong, Singapore, Taiwan), the accession countries of the European Union, the EU in its entirety and nations as divcerse as India, Iran, Korea and New Zealand.

A KBE is an economy in which the generation, application and dissemination of knowledge is seen as the principal driver of economic growth. Education is key to the development of a successful KBE and most national plans focus heavily on strengthening the education sector.

It is in these national delivery plans and in the commentaries upon them that one begins to find references to G&T education. Indeed, the rationale for gifted education in these countries is typically linked with the transformation process. This is evident in much of the literature about gifted education in Singapore, South Korea and now Saudi Arabia.

Two other areas of economic research may hold particular promise for gifted education.

The Creative Class

One is the work of Richard Florida,a professor at the University of Toronto and founder of the Creative Class Group think tank in Washington DC.

Florida identified the creative class, a socio-economic group, comprising some 40 million creative and knowledge-based workers in the US, destined to play a key role in future economic growth.

Florida argues that countries and cities that actively seek to support and retain such highly mobile workers will thrive, whereas those that do not will stagnate or even decline.

These ideas are influential, even though they remain controversial.

One important question for gifted education researchers is whether there is a strong correlation between the cities that score highly on Florida’s ‘creativity index’ and local education systems that are effective in developing the next generation of the creative class, including the not inconsiderable minority likely to be present in G&T populations.

Several KBE’s are now strengthening the creative dimension of their gifted education programmes in response to a perceived lack of innovative capacity amongst their students. One corollary of Florida’s argument may be that several of our big cities need to do the same.

The second area of promise is the beguilingly named ‘smart fraction theory’. But I want to say more about that in my next post.

Why this matters

The key conclusion I want to draw is that – now we are in recession and there is heavy pressure on public expenditure – G&T education is at great risk of being cut because it is wrongly believed to be an unnecessary extra. This would be an excellent time to accumulate the research evidence to disprove that belief.

So when, for example, US senators attempt to remove Javits Program funding, the gifted lobby is equipped with sound economic arguments and calculations to show why this would be so shortsighted.

GP

June 2010

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4 thoughts on “The Economics of Gifted Education

  1. GP – I have been on vac this past week, but have still been writing. In fact, yesterday @LesLinks told me to stop. This morning at 6:10 AM (EDT), I wrote – “An economic downturn should be the impetus for greater investment in gifted education; not the derailment of it.” Too spooky! I was cosidering a blog post, but you have already written it, and much better than I! My thought – if we are thinking along the same lines, how many others may be also who know nothing about Twitter? Now – I’ve already been working on post about empathy in a global society (I was a sociology major) and how it affects gifted children – so please allow me to finish that one – lol!

  2. Tim, that is a really thoughtful, concise and easily understood post. Your thinking. This is good. ;-)Now, it just needs the educational world to start thinking too.. (by the way, how’s your Globish??)

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