bracket, the proportion of italian senior high school graduates rose to 70 per cent, against an oecd average of 81 per cent. the proportion of children completing junior high school studies has also been rising, gaining more than 10 points in recent years to over 80 per cent. for university education, however, the gap is certainly worrying. here, italy seems hard put to keep up with the other advanced countries : again in 2009, the proportion of graduates in the 25 – 64 age group was less than 15 per cent, or just half the oecd average ; amongst people aged between 25 and 34 years, it exceeded 20 per cent, compared to an oecd average of around 37 per cent. over the past twenty years, direct testing of reading comprehension, logical and mathematical skills, and the ability to combine pieces of information to solve problems of varying complexity, reveals a similarly worrying picture. at the end of primary school italian students are at least as skilled as in the other developed countries, but in the later stages of formal education they fall behind. for 15 - year - olds, the gap found by the pisa survey carried out by the oecd in 2006 corresponded to around one school year ; and although this diminished between 2006 and 2009, it remained significant. the gap reflects severe disparities between different parts of italy, with the scores in the north slightly above the oecd average and those in the south dramatically lower. these disparities are subject to various interpretations involving their geographical distribution or the discrepancies between different schools rather than within any individual school. yet the fact remains that a country like ours, poor in material resources and now lagging on various fronts, should invest in “ knowledge ”, not “ below ” or “ around ” but above the average of other countries with more natural resources. such deficits are also observed in respect of the skills of the adult population. the international adult literacy and lifeskills survey ( all ) conducted in 2003 to gauge functional literacy and numeracy together with analytical and problem - solving abilities shows that about 80 per cent of italians aged between 16 and 65 are unable to apply linear reasoning and draw inferences of average complexity by extracting and combining information provided in written texts that are little more than basic. they are, that is to say, functionally illiterate : they lack adequate reading comprehension, logical and analytical skills to respond to the demands of modern life and work. this is the highest percentage in any of the

italy ’ s historical lag. there is a pressing need for a strong commitment, both in the public and private sector, to invest in knowledge now, in order to break the vicious circle of the small stock of human capital and its undervaluation. as an economist, i have considered the consequences of human capital for economic development. however, this talk is not intended to offer a mechanical or one - sided vision of the dynamics of this relationship. it would be narrow - minded to think that knowledge is important and should be invested in solely because it can increase our rate of economic growth. knowledge, learning, can also help to stimulate public spirit and increase social capital, both of value in and of themselves quite apart from the benefits to economic growth. in other words, investment in knowledge constitutes a crucial factor in social cohesion and welfare. bis central bankers ’ speeches