Close to 1,000 people paid tribute to Bank of Canada governor David Dodge at a fund raising dinner for the Canadian Foundation for Economic Education in Toronto Monday night.

After a standing ovation, Dodge gave a speech on the need for better economic education of the Canadian citizenry.

“In an increasingly complex and competitive global economic environment, furthering our national economic welfare will depend importantly on the quality of our labour force. But it will also depend on the ability of our citizens to conduct their daily economic affairs competently and effectively,” Dodge said.

Dodge argued that the societies that have been the most successful in improving the welfare of their citizens are those that have “provided a social climate in which the dynamism and creativity of individuals and businesses can thrive”. To that end, he said that it’s important to offer proper incentives for those working in government to encourage and facilitate the drive in the private sector towards higher productivity and innovation.

“But we should also have the right incentives for the private sector to work towards enhancing the public good and the productivity of collective action by governments,” he said.

He added that “The public sector has a responsibility to understand how individuals and businesses work in order to provide the appropriate framework for the efficient functioning of markets..”

Dodge recommended paying more attention to early childhood development, focusing more on the development of literacy skills in primary grades, and linking formal education to practical experience. “We must encourage our youngsters, while still in school, to start familiarizing themselves with the world of banking, finance, and the economy more generally if we want them to be “functionally literate,” capable of handling their daily affairs effectively as tomorrow’s adult citizens,” he said.

“We at the Bank of Canada feel very strongly about the need for improved economic and financial literacy in Canada. An economically more literate public means a more effective monetary policy,” Dodge concluded.

His speech was followed by the announcement of the creation of three full-tuition scholarships named after Dodge – in policy studies at Queen’s University, in economics at the University of British Columbia and in public administration at Humber College in Toronto.