There are countless studies in economics literature that highlight the links between increases in educational levels and economic productivity and improvements in society's welfare.

The simple fact is you earn what you learn. Higher education is the key to improved earnings and prosperity.

We see evidence of this in wage data provided by the Bureau of Labor Statistics. Last year, the average hourly wage in Texas was $18.90. In the same year, the average hourly wage in Texas for internal medicine doctors was $77.22, $42.67 for geological engineers, $43.50 for computer software engineers and $29.70 for nurses.

The more you learn, the more you earn.

The delivery of services has largely replaced agriculture, manufacturing and mining and is a major contributor to our growth. At the beginning of the 20th century, roughly one quarter of our workforce was employed in services. Today that number is north of 80 percent.

Over the past 50 years, annual economic growth contributed by services has held steady at about 2.2 percentage points, while the growth from goods has fallen significantly – from an annual average of 1.2 percentage points in the 50s, 60s and 70s to less than 0.5 percentage points today.

More and more, we are a service-driven economy. Winston Churchill referred to the "superfine processes" that added value to basic raw material inputs in the Manufacturing Age. Today, we live at an ever-higher end of the value-added spectrum, with education being the source of economic success in the Knowledge Age.

The fields and factories that powered the economy of yesteryear remain important in the United States and Texas. But more important in the current economy and to our economic future is the production of high-value-added services. In the world of "superfine processes" of the Knowledge Age, digits are the new widgets. The brain is to the Knowledge Age and mastery of digits what the engine was to the Manufacturing Age and management of widgets. Education is the gas that propels that engine.

Unfortunately, here in Texas, we're running low on gas.

Take a look at the membership list for the Association of American Universities, which is regarded by most scholars as the definition of the cream of the crop of research universities. The AAU consists of 60 U.S. and two Canadian universities. These 60 U.S. schools garner about 57 percent of all federal R&D dollars to colleges and universities; they are home to 81 percent of all elected members of the National Academy of Sciences, the National Academy of Engineering and the Institute of Medicine – the highest recognition in each of those fields. Since 1901, 35 percent of all Nobel Prizes have gone to individuals affiliated with AAU universities.

California has nine AAU members, with four of those in the greater Los Angeles area. New York has seven.

And Texas? We have three: Rice, UT­Austin and Texas A&M.

How can we expect Texas to excel in the Knowledge Age with only three established fountainheads of advanced knowledge? How can we expect to navigate our way into the economic future in a competitive globalized world without a single elite university in Dallas?

When you travel around Dallas, look at its skyline. How many factories will you see? You won't see any – at least none of the old-fashioned kind with smokestacks, loading docks and noisy machines. Instead, you will see glass and steel buildings that house the machines and capital stock of the modern economy: human brains.

We need more of that brain power here at home. We need thousands upon thousands of the world's best and brightest here in Texas, in Dallas and Fort Worth. We can fuel our economy with graduates from other states and other countries – up to a point. But that is no substitute for Texas-bred intellectual talent, with its roots in our community and its commitment to building our state.

We should not accept that Texas has only two universities ranked in the top 50 in the nation and only one, Rice, in the top 20. We should not accept that the Longhorns of UT­Austin are outflanked on the educational battlefield by six campuses of the University of California System.

If any of us are willing to accept that the presidents of UT­Dallas, SMU, TCU, the University of North Texas and UT­Arlington are fighting with one hand tied behind their backs because our state leaders cannot rise to the cause and give to this state what California has in San Francisco and Silicon Valley, or what New York has in Manhattan, Rochester or Buffalo, then we are suffering from a serious case of denial.

Denying the people of Texas the tier-one universities they deserve presents a serious barrier to our future prosperity. We face many challenges head-on in this state. This is perhaps the biggest challenge of all.

Richard W. Fisher is president and CEO of the Federal Reserve Bank of Dallas.