International Review of Management and

Marketing
ISSN: 2146-4405

available at http: [Link]

International Review of Management and Marketing, 2016, 6(S1) 53-58.

Special Issue for "Socio-Economic and Humanity-Philosophical Problems of Modern Sciences"

The Role of Education in Economic and Social Development of

the Country

Kateryna V. Astakhova1, Alexander I. Korobeev2, Victoria V. Prokhorova3*, Andrey A. Kolupaev4,

Mikhail V. Vorotnoy5, Evgeniya R. Kucheryavaya6
1
Vladivostok State University of Economics and Service, Vladivostok, Russia, 2Law School, Far Eastern Federal University,
Vladivostok, Russia, 3Kuban State University of Technology, Krasnodar, Russia, 4Southwest State University, Kursk, Russia,
5
Herzen State Pedagogical University of Russia, Saint Petersburg, Russia, 6Tyumen State University, Tyumen, Russia.
*Email: vi_pi@[Link]

ABSTRACT
The article said that in the current context, education is an important component of social and economic development. Company represented
by the public, corporate, private sector households across the demand for professionals in the goal-setting exercise education. I must say that
the accumulated knowledge (scientific, methodological, spiritual) provides a level of education of population, databases and knowledge bases.
Implementation possibilities of society is carried out in the research, cultural, industrial, business and other activities in the form of suggestions
of experts. In turn, the effectiveness of the educational system and its development is based on three defining principles - accessibility, quality
and security.
Keywords: Education, Socio-economic Development, State, Educational Services
JEL Classifications: A20, P35

1. INTRODUCTION all, the European space through the implementation of a high

intellectual potential of international educational standards
A distinctive feature of the XXI century is to accelerate involves the development of a national system to ensure the
innovation in the rapid deployment and contradictory processes quality of educational services.
of globalization. At the heart of the new global world order
are the backbone links interrelated phenomena of knowledge, The quality of educational services is a multidimensional category,
human and economic. Reality of this world dictate to improve encompassing all of its functions and activities: Educational
the quality of higher education, which implies a radical change in programs, research, human resources and logistical base, so the
the structure and content of training, the introduction of modern evaluation of the quality of higher education should be based
educational technologies. In the context of globalization and on multivariate analysis, the structure of education, its content,
increasing competition in the economic sphere, higher education technology, training, resource potential of universities. It is the
becomes a competitive environment. A necessary condition for basis for the development of a conceptual model to improve the
the growth of competitiveness of educational services of higher quality of educational services. The feasibility study identified
education institutions on a global scale to improve the quality the boundaries of angles isolated invariant with respect to the
of higher education. The current state of the national system of components of partnership strategies of government and business
higher education does not correspond to the changed realities in the system of higher education in the conceptual modeling of
of public life, the needs of business and the labor market. new integrated structures involved in socio-economic development
Integration of Russian higher education in the world and, above of the region in the horizontal plane of the education market.

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 Astakhova, et al.: The Role of Education in Economic and Social Development of the Country

2. THE MAIN PART to create it and be reimbursed the cost of education in many areas
and outside areas (Marshall, 1993). According to the statement of
In modern conditions, education is an important component of the American scientists Grayson and Della, “education is directly
social and economic development. Company represented by the related to competitiveness. No society can have high-quality
public, corporate, private sector households across the demand for products without high-quality raw materials. Education creates
professionals in the goal-setting exercise education. Accumulated a 'human capital,' which is in conjunction with 'physical capital'
knowledge (scientific, methodological, and spiritual) provides and gives an increase in productivity and quality. That was always
a level of education of population, databases and knowledge true, but it is doubly true for the global economy is technically
bases. Implementation possibilities of society is carried out in difficult” (Liszt, [Link]
the research, cultural, industrial, business and other activities
in the form of offers of experts, and the effectiveness of the The concept of “human capital” was formed into a single concept
educational system and its development is based on three defining in the late 1960s. Schultz, Becker, Denison, George. Kendrick,
principles - accessibility, quality and security. Robert Lucas - the founders of the concept of human capital
considered education not only by the consumption of certain
The key role of education requires a special relationship to him forms of educational services, but also on the part of productive
by society and the state, determines the dynamics of socio- capital investments (Toffler, 1980). So, Mr. Becker was first used
economic development, acts simultaneously on two interrelated method for evaluating investment in physical capital for comparing
and interdependent markets - market of educational products and the efficiency of investment in human capital, using which he
services and the labor market. analyzed, changes in the distribution of income after increasing
the level of human capital among the masses as well as the effect
Education - this is one of the most dynamic and investment of the reproduction process on the welfare of individual countries
attractive areas of the market economy. According to expert (Becker, 1993).
estimates, in the developed countries, the rate of annual increase
in the volume of demand and supply of educational services is In the USSR, Russian researchers analyze human capital
10-15% (Litvinova et al., 1997). wore mostly critical, determined secondary importance to this
category. In modern Russia, the concept of “human capital” was
William Petty, the first focused on the high importance of citizens’ studied systematically with the production, organization and
wealth of knowledge as an element of the wealth of the kingdom management of educational services highlights the following
(Petty, 1940; Petty et al., 2000). Adam Smith compared the person authors: Dobrynin, Dyatlov, Kapelyushnikov, Crete, Chekmareva,
with a pre-acquired specific knowledge and skills, with high-tech Shchetinina et al. (Becker, 1993; Kendrick, 1978; Kapelyushnikov,
expensive machine: “… The work done by the machine until the 1981, Kuznetsova, Forecasting and monitoring of the market of
occurrence of wear and tear, return on investment in its capital, educational services and Schetinin, 2001).
bringing a profit of at least normal levels. Man, get an education,
it can be compared to an expensive machine discussed above. It For example, Gevorgyan, considering human capital as an
is believed that the work that he has learned to perform, to be paid economic category, he emphasizes that “the human exploration of
above the wages of ordinary employees, and allow him to recover information (knowledge) is transformed into an important resource
all the costs of education, bringing a profit, which, at least, brings for the development of production, and investment in human
generally equal assets, but it must be done in a reasonable time” capital is becoming a priority for economic growth. This, in turn,
(Smith, 1962; Kobersy et al., 2015). leads to a sharp increase in the role of education in the reproduction
of the productive powers of man” (Woodpeckers, 1995).
In the works of Fisher capital it is seen as a category that characterizes
the labor skills of people, raw materials, natural resources, which Under the human capital refers to a person’s ability to work, his
brings transformation later return in the form of services or products skill, knowledge, skills. Determine the level of human capital in
(Fischer et al., 1992). Say, Senior, Mill, Irving Fisher wrote about every consumer of educational services available at each stage of
the “human” form of capital, by which they mean the theoretical its accumulation, ranging from pre-school education, to higher
knowledge and practical skills. They believed that the investment education, as well as postgraduate or advanced training. Every
in time and labor associated with the receipt of an education, consumer of educational services and, accordingly, the copyright
must serve as a source of increased productivity growth, and as a in the future human capital is always in proportion to the estimated
consequence - increase the revenue base of the company (Say, 1986). benefits and costs. Gevorgyan noted that the expected benefits are
a major factor in deciding the rate of return to education for society
Issues related to the educational services market (DOC), with differs from the rate of return for the individual, as the costs and
investments in human capital were first covered in the works of benefits of education for society and the individual are calculated
Marshall, which states that education enables many who might differently (Woodpeckers, 1995).
die in obscurity, to be able to expand their potential abilities
(Fisher, 1987). We emphasize that ideological constants present in the human
capital theory, showed a major impact on social and economic
List claimed that the welfare of all humanity and the separate state policy of many countries. This led to a change of attitude of society
is not associated with material wealth and the level of development to invest in human. They saw the investments that promote the

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 Astakhova, et al.: The Role of Education in Economic and Social Development of the Country

production, and the long-term in nature, effect. This contributed 4. Broad access to more promising, interesting work;
to the theoretical justification for the activated form of education 5. Submissions parents about the future of children, which is a
and training of professional workers in many countries. Certain determining factor in the choice of life strategy as a result of
categories of “human capital” are shown in Figure 1 (Gevorgyan, the traditional system of family education in Russia;
2005). 6. The level of education and social status of the parents. Which
affects the orientation of their children (the continuity of
Thus, we believe that when considering the category of “human generations, the continuation of the profession of parents).
capital” paramount need to rely on the opinion of Becker, who For parents, the child’s higher education serves as proof of
indicated in the study, saw the definition - the expected impact of the the viability of the family, the consistency of its material and
regulatory limit investments in investments in employee training, social resources;
driven by the manager to a cost-effective strategic decisions. 7. The choice of profession, to make friends or acquaintances;
Rates of return are the regulator of the distribution of investments 8. The prestige of a particular type and level of education.
between various types and levels of education, including between
the education system and the rest of the economy. Increasing As a short-term factors are considered:
the impact of borders indicate overinvestment, reduction - of 1. Appreciation of non-market activities and interests which are
underinvestment. connected with education (learning process, communication
with friends, school or student life);
It costs on the production of human capital include: Direct costs, 2. The desire to go to any university young men to defer military
including tuition fees and other education expenses, change of service;
residence and work; loss of earnings, which is an element of 3. The desire of girls to go to school, due to the desire to marry
opportunity cost, since education, change of residence and the well (Korolev, 2007).
work associated with the loss of income; as well as moral damages,
since education is a difficult and often unpleasant occupation, job According to the point of view of Mr. Winston’s education - this is
search tires and exhausts the nervous system, and migration leads a business, because in this area and made available at a specified
to the loss of old friends and acquaintances (Woodpeckers, 1995). price and purchased educational services necessary for the activity
factors of production, however, differs significantly from the
In assessing the expected benefits of investment in human capital formation of business (Davydova, 2004). The scale of education
for individuals, researchers isolated and short-term factors as a separate sphere of socio-economic relations, and the value to
affecting the change in the dynamics of demand of people with society can be judged by the following figures: Worldwide trained
consumption of educational services. 81 million students in higher and secondary special educational
institutions, of which 40% are concentrated in the seven leading
The long-term factors include: countries (USA, Germany, France, Great Britain, Italy, Canada)
1. A high level of wages for a future life; (Gordon, 2005).
2. A greater satisfaction from the work chosen for life (moral
benefits); In modern conditions in higher education can be clearly seen
3. The achievement of higher social status. It is assumed that the following trends: Increasing the educational level of the
in a modern society can rise from the bottom to the top, and population, the internationalization of higher education, the active
it requires only the effort. There is a so-called “lifts” social development of government schools – “autonomy” of education,
mobility, one of which is education; which, in turn, define the main vectors of state policy in the field of
higher education in the countries of the Organization for Economic
Figure 1: Classification category of “human capital” Co-operation and Development (OECD): Improving access to
education, quality assurance of higher education, improving
financial efficiency in the higher education sector (Vasiliev et al.,
1999).

In countries such as Italy, Japan, France, the United States

increase in productivity is achieved through the creation and
dissemination of technological innovation, with the majority
of these innovations is the result of fundamental and applied
research. Higher educational and qualification level allows
workers to use new technologies to adapt quickly to changes in
the environment (Vakhshtayn and Meshkov, 2005). Investments
in human capital are paying off in the form of high-quality labor
force, which has a high level of wages corresponding to the social
status and greater and prestigious post. In terms of economic
benefits for the state education contributes to the expansion of
demand, thus stimulating the growth of production of goods
and services.

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 Astakhova, et al.: The Role of Education in Economic and Social Development of the Country

Currently, the process of modernization and reform of education in country’s competitiveness, increase scientific and technological
virtually every country in the world. And, despite the differences capacity, expansion of export opportunities, and others. The
in systems and approaches in this field, global trends in education increasing is currently competition in the provision of educational
have much in common, in particular: services of higher education that goes “… beyond the traditional
• Changes in the objectives and functions, strengthens its conceptual, institutional and geographical boundaries,” initiate the
innovative component prevails over the cultural characteristics process of institutional diversification. There are virtual license
of the developing countries; (franchise), corporate universities, brokers in the field of education,
• Improves the quality of education in line with the changing as well as software vendors, publishers, entertainment companies,
needs of society involves real implementation of new “seeking to capitalize on the potential of a new international
educational technologies, changing the whole system of market” HPE educational services (Burdenko, 2004; Shkurkin
training and retraining of highly qualified specialists; et al., 2015).
• Focus on the principles of lifelong education is the
introduction, as the new educational technologies, and finding The increase in budgetary financing of educational services
new ways of presenting educational services tailored to the in the 1994-2004 biennium. In Russia it has resulted in higher
needs of school-leavers and students; professional education “institutional trap” provoked by the
• Formation of new goals of the school, which in the twenty- authorities and the management of the state and private business,
first century. It becomes a social institution to meet the needs and manifested in various forms, including:
of society in vocational education (Dobrynin et al., 1993). • Increase in the number of state universities with the unjustified
increase of the planned contingent of admission in 1995-
According to expert estimates, $1 costs in the education system 2004, which led to a significant reduction in the quality of
allows you to receive 3 to $6 arrived. In Russia, an engineer come in educational services and the disparities in the structure of
10 times less than the income generated than in the US. Ratio social training;
cost of gross national product used for education, in our country • The preservation of regional specialized universities that
amounts to only 2.7% compared with 6.1% in developed mills, 4% in 60-70% overlap and areas of specialization of universities
developing and 5.7% - on the average in the world (Schetinin, 2001). at upgrading the status of colleges, institutes, academies and
reducing the status of universities (Kobersi et al., 2015);
Leading positions in the global economic and political space • A relative reduction of public expenditure norms per
occupied by countries that are leaders in the production of new student in 1992-1995, and then increase regulatory lag of
knowledge, introduction of innovative technologies in industry and public spending per student from the growth of the planned
everyday life, based on developments in the field of knowledge- contingent in 1995-2004;
technology. Experience shows that educated people are more • The absence or reduction of public funding for equipment,
involved in social activities and to a lesser degree integrated into materials, construction, repair, travel, etc.;
the criminal environment. The source of criminal activity, as a rule, • Restrictions on admission to different specialties and fields
are the social strata with very low incomes. It should also take into (economics, law, management) in public high schools in the
account the cultural aspects, the desire to assert positive values, lobbying and the creation of privileges non-state institutions
attitudes and ethical principles (Woodpeckers, 1995). The social of higher education bodies of representative and executive
and economic benefits of education development are grouped in authorities of the Russian Federation;
Table 1. (Woodpeckers, 1995). • “Unscrupulous franchise” state, permission to the artificial
expansion of networks unmanned personnel and material
As can be seen from Table 1, nation-wide benefits are determined and technical base of universities and branches, which led to
by the growth of social productivity of labor, increasing the decline in the quality of teaching, qualifications of graduates,

Table 1: Potential benefits of education for the individual, the company and the state
Benefits Private Entrepreneurial Public
Economic Higher wages, pension Profit maximization Growth of social productivity of labor
Better job opportunities Labour productivity growth Growth of the country’s competitiveness
Higher savings Improving the quality of The growth of scientific and technical potential
Personal and professional mobility management, marketing Expansion of export opportunities
Career prospects The increase of Reduction of transfer payments
competitiveness of production The increase in tax revenues
Using the cheap highly skilled The increase in aggregate demand and supply
workforce Accelerated development of new innovation technologies
Social Improving the quality of life Formation of a favorable social The formation of the foundations of civil society
Improving working conditions and psychological climate Improving the health of the nation
Satisfaction with work Favorable conditions for Formation of the middle class
A healthier lifestyle refresher training Reducing the criminalization of society
Implementation of creative Quick adaptation to the The development of democratic values, attitudes and
abilities environment, to the needs of cultural norms
the information economy

56 International Review of Management and Marketing | Vol 6 • Special Issue (S1) • 2016
 Astakhova, et al.: The Role of Education in Economic and Social Development of the Country

the pursuit of a diploma instead of competence (Pankrukhin, 49 thousand. Households conducted Roskomstat. The question:
1995). How would you do with surplus funds? They answered that they
were ready to send them to education, 4.2% of respondents,
Today, the development of education systems depends on many 30.2% - for the purchase of various material benefits. In addition,
factors, which primarily include: and in that part of the population that appreciates the benefits
• Mass pursuit of higher education; of education, have a desire to avoid the cost of these goals
• Knowledge societies: Regular updates and the addition of (Woodpeckers, 1995).
“basic” higher education due to the increased dynamics of
the development of society and technology; 3. CONCLUSIONS
• Diversity of the needs of society and, accordingly, the
requirements for the higher education system - the content, Currently, the sector is highly developed enough extra budgetary
scope, forms and methods of learning; paid education and educational services market operates a large
• Liberalization of the administration form part of the state; number of private educational institutions. The emergence of non-
• Demographic decline, a change in the demographic structure state educational institutions contributed to the development of
of the population: An increase in the proportion of more competitive relations in the educational market: State universities
adult and elderly population, compared with a share of the were forced to activate efforts to improve its competitiveness,
traditional college-age population and, as a consequence - the increase the mobility of educational services, training programs
need to incorporate in educational policy needs of older age and the level of innovation capacity.
groups;
• Lack of public resources necessary to support the development During the period in 1995-2006 the number of students in
of higher education; Russian universities has increased two and a half times and
• The development of innovative educational technologies; came close to 7 million people. On the 10th people there are 430
• The globalization of social and economic processes and students, which is one of the highest rates in the world. According
the associated internationalization of the education market to the survey, 76% of students satisfied with their education and
(Formation of a society based on knowledge, 2003). believe that they can work in any country (Gevorgyan, 2005).
When planning in education must take into account increasing
Factors of efficiency of the educational system can be grouped as international mobility, a high proportion of the costs of higher
follows: Availability, which means the desire of students to learn education and increase its value. In this context, it becomes an
(nutrition, health, support for parents), the external environment of important trade-off between quantity and quality of education
training (leader interested in educated workers, equal access to all (Inshakov, 2005).
levels of education, etc.); Software - Government support, monitoring
the efficiency of resource use, the amount and distribution of public Positioning education as a key factor in economic and social
funds, performance assessment, satisfactory system of information, development, we note that, firstly, the increasing role of skilled
monitoring and feedback, etc.; quality - relevant programs, labor increases the requirements for the level of education. Second,
competence in the global economy, contribute to the social accelerate the aging process and the depreciation of qualification
wealth, flexibility and adaptation to change, basic education and promotes self-education and expand the scope of additional
re-certification of teachers, salaries and professional development, vocational training. Third, in a rapidly developing knowledge
results-based monitoring of quality assurance (Inshakov, 2005). economy, the role of intellectual labor and reduced the importance
of physical labor. Fourth, change of occupation requires time,
The key task of the Russian educational policy - to ensure a high educated people spend less time searching for a new job.
quality of education on the basis of preserving its traditions and
in line with current and future needs of the individual, society and
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