# INTRODUCTION

We know that it Is difficult to bring about a transformation which takee a socie y out of underdevelopment snlely through education; but, on the other hand, we must avoid that the nature of education, or the ;ack of it, blocks the possibilties of transformation and development.' As in the twentieth century, the quality of a country's human resources will determine its ability in the twentyfirst century to compete in international markets and assure the well-being of its citzens. A major Issue is whether Latin American countries will be forced to sell cheap labor ard over-exploi **t** heir natural resources to support even current inadequate living standards. Or will these countries follow the lead of successful European, North American, and now Asian countries that have Invested heavily in their human resources? Today these countries are reaping the benefits in improved international competitiveness, faster economic growth, and relatively greater distributional equity.<sup>2</sup> Two hundred years ago Adam Smith recNgnized the state's responsibility toward human resource development.3 But, In devising their developrn,ent strategies and public expenditure portfolios, many developing societies--and among them Latin American ones are prominent--have yet to accord due attention to their most vital resource. The 1990s are likely to be cha,acterized by a pace of change exempifried by recent events in Eastern Europe. In the face of failing walls, rapidly advancing technology, expanding global links, and threats to the ecology, how a society maintains or Improves its competitiveness, ensures social equity, "adjusts"-or indeed survives--will ultimately depend upon success in developing its human resources. The ability to learn, adapt, and create is fundamental.

This paper seeks to emphasize the need for major increases in attention to and expenditure on education and health systems In many developing countries, especially in Latin America, to improve the coverage and quality of the services they provide. To this end, we review statistics compiled to facilitate International comparisons, present current profiles of human resource development, and compare resource allocation trends in nine Latin American countries and two reference groups composed of selected countries in East Asia and Northern/Southern, Europe. We have selected this sample of 23 countries<sup>4</sup> on three criteria: somewhat comparable income levels, possible similarities in the historical development of their social programs, and a perception that the Asian and European countries may serve as valid comparators and/or models of relevance for Latin America. In Europe we have selected countries of northern and southern Europe which had comparatively late starts in industrialization. The analysis focuses on recent (mid-1980s) Indicators of achievement in education and health, on the level and composition of central government spending, on the quality of the delivered product, and on the intensity of research and development effort. Relying on trends and themes emerging from country and regional comparisons, the paper Identffies an agenda for policy reform in human resource developmen **t** o enhance a country's intemational competitiveness in the decades ahead.

# BASIC INDICATORS

Consider first several findings that emerge from a review of the basic data and how these findings may be related to the currently accepted body of developmen **t** heory.

Educators, policymakers and, more recently, economists have stressed the Importance of primary education. Today, access to prlmary education In newly Industrializing countries is virtually universal. What dffferentiates countries I Oteiza (1989) p. 830.

- 2 This question emerges clearly from the Important work of Fajnzylber (1989), which documents the extent to which the countries of Latin America lag behind a group of Asian and European countries he characterizes as ^growth with equity Industrializing countres".

- 3 Smith (1985 edtlion), "Inquiry of how far the public ought to attend to the education of the people, p. 445.

- 4 Argentina, Brazil, Chile, China, Colombia, Costa Rica, Finland, Greece, Italy, Korea, Malaysia, Mexico, Norway, Peru, Phlilppines, Portugal, Spain, Sweden, Talwan, Thailand, Turkey, Uruguay, and Venezuela