Teaching Children Economics

American investment guru Warren Buffett never received an allowance for nothing while growing up. He had to occasionally shovel snow in front of his house for five hours, only to get less than one dollar from his grandfather. This is how he learned the lesson of checking the price first before cutting a deal. When asked how to prevent another financial crisis at a Berkshire Hathaway shareholders’ annual meeting in May in Omaha, Nebraska, he stressed the importance of forming good financial habits from childhood. He also said learning more about economics in elementary school is more valuable than taking courses in higher education later. He emphasized the importance of economic education in childhood.

In 2006, the French government expressed deep regret over providing incorrect education on economics. To tackle ever-worsening youth unemployment, France sought to enact a law on initial employment contracts to increase flexibility in hiring and laying off workers. The country’s youths and students had held violent protests in 1968, causing the bill to be abolished. At the time, the International Herald Tribune reported that French education on economics instilled a negative perception of the market and business into students, adding the French public’s lack of understanding of market economics caused the protests. The French government belatedly admitted its failure and reformed the framework of economics education.

In 2004, the United States enacted laws on improving economics education and early education on finance. The country took responsibility for economics education, which had been conducted by the private sector since the Great Depression. The U.K. also strengthened financial education in all school classes to enhance student understanding of finance. Economics education is also necessary to prevent financial crises that occur frequently. Having students read the economic sections of newspapers is also a good way to teach them about the economy. Many U.S. universities use newspaper articles on the economy as classroom texts.

The Korean government plans to revise economics textbooks for public schools to focus more on understanding the market economy than economic theory, while increasing hands-on education on the economy. Class hours for economics education will also be increased. Still, Korea’s economics education is a far cry from the early education that Buffett recommends. A Korean student does not learn about the economy before the fourth grade. A high quality economics education is needed to make students into pillars of the Korean economy.

Editorial Writer Park Yeong-kyun (parkyk@donga.com)