regional central banks. thus, as tommaso might suggest, charter changes also played an important role in the structure of policy. in the eurosystem, the balance between the center and the regions is still evolving. the composition of the governing council, the eurosystem ’ s equivalent to the fomc, and the administrative roles of the governing council and the executive board reflect the relative strength of the national central banks. this difference in the relative power of the center, however, should not have great significance for the conduct of monetary policy. as in the federal reserve system, each eurosystem policymaker is expected to act in the interest of the entire currency area. in the united states, once policy implementation boiled down to managing the consolidated balance sheet of the federal reserve banks, it made sense to concentrate open market operations in new york, where most major banks and dealers had offices. new york bought and sold on the fomc ’ s orders, but the resulting portfolio was allocated to each reserve bank based on its capital. in the eurosystem, open market operations are conducted in a unified but decentralized manner. each national central bank collects bids from financial entities in its country and relays those to the ecb where they are ranked and allocated accordingly. i would argue that these slight variations in the implementation of monetary policy reflect the financial circumstances under which each institution operates, with a unified money market in the united states and more - fragmented ( but consolidating ) money markets in the eurozone. internal dynamics although the 1935 legislation that created the federal open market committee of today shifted monetary policy power from the regions to the center, important questions remained about the internal workings of the fomc itself. with only five of the twelve reserve bank presidents on the committee at any one time, how were these seats to be allocated? 2 the fomc finally settled on a rotation system that was a compromise between strict equality and relative importance of each district in the financial system. new york was given a permanent seat. cleveland and chicago were grouped together, and the remaining reserve banks were put into groups of three. thus, presidents of reserve banks other than new york would be fomc members every other year or every third year. that rotation structure has remained unchanged since 1942. the fomc operates through formal votes on policy questions, yet in recent years dissents in the recorded votes have been remarkably rare. through discussion and with the leadership of the chairman, the committee often

new ideas and products has become ever more difficult because of the rapid international diffusion of technology. nonetheless, to date, we have not fallen behind in converting scientific and technological breakthroughs into viable commercial products. but, to be fully effective in realizing the gains from technological advance will require a considerable amount of human investment on the part of managers and workers who have to implement new processes and who must be prepared to adapt, over their lifetimes, to the ongoing change that innovations bring. clearly our educational institutions will continue to play an important role in preparing workers. while we all are concerned about the performance of american elementary and secondary schools compared with those in other developed countries, there is little question about the quality of our university system, which for decades has attracted growing numbers of students from abroad. however, the notion that formal degree programs at any level can be crafted to fully support the requirements of one ’ s lifework is being challenged. a great deal of innovation and development has been occurring in the business sector where firms are striving to stay on the cutting edge, in an environment where products and knowledge rapidly become obsolete. education, as a result, is increasingly becoming a lifelong activity ; businesses are now looking for employees who are prepared to continue learning, and workers and managers in many kinds of pursuits had better look forward to persistent hard work acquiring and maintaining the skills needed to cope with a dynamically evolving economy. the recognition that more productive workers and learning go hand - in - hand is becoming ever more visible in both schools and in the workplace. linkages between business and education should be encouraged at all levels of our education system. your business school is an excellent example of how our educational institutions are building bridges to the private sector that will have payoffs in how well graduates are prepared to meet the challenges of an increasingly knowledge - based global economy. the growth of high - tech industry here in the research triangle, as well as in silicon valley and boston - - all areas rich in educational and research institutions - - is no accident. in the private sector, a number of major corporations have invested in their own internal training centers - - so - called corporate universities. some labor unions have done the same. more broadly, recent surveys by the bureau of labor statistics indicate that the provision of formal education on the job has risen markedly in recent years. by 1995, 70 percent of workers in establishments with 50 or more employees had received some formal training during the twelve months preceding the survey. the incidence of training was relatively