What are the main means of economical development? Why are there developed and developing countries? How can developing countries become developed ones? These questions have become the current issues of modern society. The government of every country thinks over the ways of improving their economy.
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The main differences between developed and developing countries are not in their inequality of resources but in the disparity in knowledge. More than that, the wealth of natural resources in some cases may be the curse for the country as far as raw materials are usually cheaper than manufactured goods. The developed countries aim at the developing of high-qualified industries which produce ready-made goods for higher prices and they have a lot of advantages for the development of their economy.
The development of the economy depends on the development of economical studies. New-developed strategies help to increase the economical growth of the country. The main problem of the current economy is different market imperfections such as imperfections in finance distribution. The well-developed sector of economic studies is looking for remedies to such market imperfections which help to take the country away from the crisis. Knowledge is considered to be a public good that is why the accumulation, adaptation, absorption, production, and transfer of knowledge are the keys to economic development.
The development of a “learning society” is the basis for the development of the economy. There is no doubt that investments in infrastructure, technology, and education are profitable for the country. Stiglitz points out the root for the economical development in the education system. The secret of many developed countries is the reasonable economic exploitation, knowledge accumulation, policies, and institution-building. The process of accumulation of technological and organizational capabilities plays a crucial role in the economy.
Emulation has become the notion that describes the current economical state of many developing countries. They try to imitate the way of development of other leading countries to increase the level of their economy. There are some cases when catching-up countries not only emulate the leading ones but even “leapfrog” them in the production of the newest technologies. It happened when Germany and the USA leapfrogged England in electromechanical engineering, synthetic chemistry, and consumer durables. As we can see, those countries are leading who invest in scientific development.
Stiglitz’s point of view may be taken into account in any area of our life. The main point of success is knowledge. Knowledge is power. Those people are successful who have more knowledge than others. That is why I need to gain knowledge during my studies as far as it is the most profitable investment in my life. There are a lot of people who spend their money on different goods, pleasures, and entertainment. This money is spent unreasonably. The money spent on education will provide the percents from your investment during your whole life. Those people are rich who know as well as those countries are leading who invest in education and technological development. People and their skills are the most precious goods in the economy that is why the government of any country should first of all take care of human resources. If you want to spend your money reasonably, invest it in your education and the income from it will not disappoint you.