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Teun J. Dekker on Humboldt’s Coming Home: How Liberal Arts Education may be Central to Europe’s Economic Future

1st December 2013

 Photo by Juergen Jauth (Flickr)

Dr. Teun Dekker graduated with a BA in Social Sciences and Humanities from University College Utrecht before earning both a Master and PhD from St. Antony’s College at Oxford, and then continuing his research at Yale University. He seeks to use Analytical Philosophy to illuminate social issues, and thereby connect the humanities and social sciences. A recipient of an NOW Veni grant, his current research focuses on studying moral justifications for high public sector wages in various societies. He remains a staunch proponent of the liberal arts.

In recent years, European higher education has seen the establishment of a number of liberal arts colleges, dedicated to small scale and intensive teaching and a wide-ranging curriculum, with an emphasis on personal and cultural development. While some have dismissed this movement as a superfluous luxury, liberal arts might yet be the key to Europe’s economic future.

Five years ago, the financial crisis of 2008 gave the world economy one of the most powerful shocks it has ever experienced. Half a decade later, it is striking how differently the events of 2008 have affected different parts of the world. Rapidly developing economies, like China and Brazil, continued to grow, suffering only relatively minor setbacks. Similarly, resource-rich countries, like Russia, have continued to enjoy substantial development. The United States’ economy, though severely damaged, has broadly recovered and found renewed vigor. In contrast, Europe continues to suffer from the aftermath of the financial crisis, the ensuing Euro-crises and double-dip recession, as well as persistent unemployment, high public deficits and anemic growth. 

            This lackluster economic performance might make one fearful for Europe’s future. If the continent is unable to deal effectively with the effects of what started as a crisis in the US housing market, how will it be able to handle more fundamental challenges, such as changing demographics, the rise of new economies and ever-increasing globalization, leading to the dispersal of knowledge, technology and talent? As the historical advantages of being the first continent to industrialize and to embrace the potential of science and technology fade away and the investments made long ago bear diminishing fruits, why should the continent be able to continue to enjoy the high standard of living it has grown accustomed to?

This is not a trivial challenge. European-style social democracy, with its broadly enjoyed social protections and near-universal provision of health-care and education, is, many would argue, one of humanity’s greatest achievements. If the continent cannot provide the economic activity to sustain that model, this form of living together might yet perish from the earth, and turn out not to have been more than an historical anomaly.

            In the long run, an economy’s ability to sustain a way of life depends on its ability to produce goods and services that other people value, either better or more cheaply than other economies can. If Europe can continue to produce things that people want and are willing to pay for, in ways that other economies cannot, Europe has an economic future. If not, all there is left to do is live of the interest of past successes. In other words, Europe must find a durable competitive advantage.

            It is not clear what this advantage could be. Europe has little in the way of natural resources, and the resources it does have, have been in production for many decades. Nor will Europe’s technological know-how provide a continuing advantage. While Europe has been, and to some extent continues to be, a leader in the development and application of new technologies, this kind of knowledge is becoming increasingly mobile. Developing economies, such as China, are investing heavily in science and engineering, founding universities and acquiring knowledge-based assets. Add to this a globalizing market for labor, and it suddenly becomes highly questionable whether the first-mover advantage of Europe’s historically leading position in industrial technology is sustainable. It is simply difficult to make a case that there is anything intrinsic about Europe that would ensure an institutionalized advantage in this field. And do not think that democratic governance can provide the kind of competitive advantage that is required. It is naïve to think that the supposed stability and responsiveness of modern representative democracy can, by themselves, ensure continued prosperity. If anything, the track record of European governments in dealing with the effects of the crisis, which can be charitably described as uncoordinated, ineffective and lame, suggests that democracy is a liability, and not the key to the continent’s future economic development.

            Hence the only place to look for durable competitive advantage is the people of Europe, the continent’s human capital. However, here too it is hard to see what makes Europe special. For one thing, the continent faces an uphill demographic struggle. Fertility rates are often lower than in other parts of the world, and consequently it is unlikely that Europe will, in the long run, have a quantitative human capital advantage. Nor will Europe’s labor be cheaper than that offered in other economies. The social protections that make the European model so valuable and decent also make European labor significantly more expensive than that of its competitors. With ever-improving global logistics, producers can more easily make use of cheaper labor elsewhere, pricing European companies out of the market. And so, the only hope for Europe is the quality of its human capital, i.e. the ability of European economies to produce superior goods and services.

But this familiar answer might not offer much comfort once one realizes that this competitive advantage might not be as durable as one might hope. Why could other economies not eventually develop the capacity to produce highly desirable goods and services? Since time immemorial, France’s wines have been dominant in the global market. However, in time, Californian wineries learned to produce wines of similar quality, which are now acquiring reputations to rival the best in France. The same could happen elsewhere, and with practically any industry in which European producers would claim to have an advantage.  And while one might think that this can be compensated for by the invention of a continuous stream of new supremely desirable products, this might seem little more than wishful thinking. What can the Europeans do that others cannot do, and will not be able to do? And why would Europe continue to be superior in the development of new high-value industries?

These are troubling questions, and it is unclear whether they can ever be satisfactorily answered. But Europe does have one advantage which cannot be copied, and which might yet provide a durable competitive advantage: its cultural capital. Cultural capital does not refer to museums and old buildings. Rather, it is a shared understanding of beauty, quality, desirability, and other values concerning how things should be done. Cultural capital is a matter of savoir faire, of knowing what it means for something to be made well, rather than simply how to make it that way. As such it is fundamentally about what makes goods and services desirable in the first place, about how they fit into a desirable and valuable way of life. Indeed, it is precisely by holding up a certain way of living as valuable that many goods and services acquire any value at all. The shared belief that it is important to be fashionably dressed, the cultural consensus that music and literature can serve to define and express one’s sense of individuality or the idea that fine foods and drinks can provide meaningful experiences in a certain way, are all cultural values, in the light of which things become desirable. 

Cultural capital can serve as a completive advantage, because having a deeply rooted understanding of what makes certain goods and services valuable in the first place enables one to continue to produce and invent things that have that quality. Indeed, by producing goods that come out of a shared cultural understanding of how things should be done, those goods rise above the status of commodities, and acquire a quality of authenticity. This makes them hard to copy. If the point of fashion “Made in Italy” is that it is a product of a particular, local understanding of the role fashion plays in a life well-lived, then nothing else will quite do. For short, if one has a superior understanding of what it means to live a certain kind of life, because one lives it, one can better make and market products relevant to that kind of life.

Moreover, this competitive advantage is more durable than most; cultural capital is inherently local, bound up with particular ways of living as they occur in particular settings. They have evolved out of centuries of historical, cultural, artistic and economic development. The very concepts of luxury and fashion were invented at the Royal courts of Europe and Louis IVX in particular. The idea that the consumption of music and literature allow one to cultivate a unique identity is a notion that comes out of the Romantic period. These shared beliefs of how things should be done, and the origin of these values, continue to inform a distinctly European way of doing almost everything Europeans do, a particular terroir. This terroir can provide both inspiration and authenticity to goods and service produced in Europe that cannot be copied or exported. And while other regions undoubtedly have their own terroirs, they are fundamentally incommensurable with that of Europe, which has acquired, through historical cultural dominance but also by the very process of globalization that threatens the future of Europe, a global appeal. 

If cultural capital is a key to Europe’s continued prosperity, it is important that this cultural capital be well-maintained, and transmitted to future generations. Only by ensuring that future citizens of Europe continue to have a deep understanding of the European way of life, of where it comes from, how it evolved and what it means, can Europe’s distinctive terroir be leveraged for future economic growth. While much of the transmission of cultural capital occurs in the family and civil society, education can play a critical role in the transmission of cultural capital. It must make students aware of their culture, their place in it, and how various ways of living have evolved. Most importantly, it must enable them to think about the questions how life should be lived, and what forms of living are truly desirable. For the answers to these questions constitute the essence of cultural capital.

However, universities in Europe rarely perform this function of maintaining and transmitting cultural capital well. Most academic education is highly disciplinary, concerned with imparting concrete skills and applied knowledge. University programs offer students little opportunity to explore their interests, and only those who specifically opt for programs in the humanities, a small minority, receive a grounding in history, literature and culture. Furthermore, many universities teach their students through large lectures, frontal education, and uninspiring examinations. Such institutions resemble factories, with little personal attention or emphasis on personal development. These are not conditions that are conducive to developing and acquiring cultural capital. If universities are to perform their role as conduits of one of the few durable advantages Europe has in securing its future, they must offer their students a different educational environment, one more suited to acquiring a sense of how to live well.

However, luckily, some universities have adapted, harking back to an ancient ideal, that of the liberal arts education. Starting with Utrecht University in 1999, and followed by liberal arts programs in Maastricht, Amsterdam, Freiburg, London, Bratislava, and other places, a number of boutique teaching institutions have sprung up dedicated to empowering students to take charge of their own development. This movement continues to spread across the continent. While this concept is often associated with American higher education, its roots lie in the education the Romans offered their citizen and, in particular, German tradition of Bildung as popularized by 18th century statesman and philosopher Wilhelm von Humboldt.

The central goal of a liberal arts education is ultimately to teach individuals how to be free citizens, rather than prepare them for specific jobs. While teaching students a wide variety of transferable skills, and giving them knowledge of a wide variety of disciplines as well as a particular specialization in a certain field, these educational goals are instrumental to the more important ideal of freedom. The freedom in question is the kind of freedom that comes with knowing who you are, where you are coming from, and how one wants to live one’s life. Those who do not know who they are, and have no idea what they believe to be valuable are, in an important sense, limited by their ignorance, as it will cause them to act in inauthentic ways, ways contrary to their nature. Only those who have a sense of their identity, can act from that identity in a deliberate fashion, and, in so doing, be truly free. Taking this as the starting point for thinking about the goals of education, results in a very different kind of experience for students.

     What defines this approach to education is a great deal of emphasis on a multidisciplinary perspective, offering students freedom of choice to explore a wide range of subjects, to determine what really interests them. These programs typically require students to take courses in history and philosophy, no matter what else they might wish to study, to give them a sense of the culture in which they live, as well as its origins. They offer small-scale and intensive teaching with a great deal of focus on active learning. Above all, they invite students to reflect on how life should be lived, and what they themselves regard as valuable. These institutions are ideally suited for the transmission of cultural capital; by making questions of values and history central to their education, they enable students to get a sense of their own culture and their place in it, which is the very essence of cultural capital, the cultural capital upon which Europe’s future competitive advantage rests. As such, they are far superior to traditional European models of higher education.

The establishment of these new liberal arts colleges has met with considerable skepticism. Fears that this type of education is for the socio-economic elites only, that it does not teach any useful skills, or that it is prohibitively expensive, have led some to question whether it is an unaffordable luxury, something that is not sustainable under current economic conditions. But if cultural capital is indeed Europe’s best hope for a sustainable competitive advantage, and if liberal arts education is superior in the transmission and development of that cultural capital, then the question is not whether we can afford to continue to invest in this type of education, but whether we can afford not to.    


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