Measuring human capital: a systematic analysis of 195 countries and territories, 1990-2016

Measuring human capital: a systematic analysis of 195 countries and territories, 1990-2016. Stephen S Lim, Rachel L Updike, Alexander S Kaldjian, Ryan M Barber, Krycia Cowling, Hunter York, Joseph Friedman, R Xu, Joanna L Whisnant, Heather J Taylor, Andrew T Leever, Yesenia Roman, Miranda F Bryant, Joseph Dieleman, Emmanuela Gakidou, Christopher J L Murray. The Lancet, http://dx.doi.org/10.1016/S0140-6736(18)31941-X

Summary

Background: Human capital is recognised as the level of education and health in a population and is considered an important determinant of economic growth. The World Bank has called for measurement and annual reporting of human capital to track and motivate investments in health and education and enhance productivity. We aim to provide a new comprehensive measure of human capital across countries globally.

Methods: We  generated  a  period  measure  of  expected  human  capital,  defined  for  each  birth  cohort  as  the  expected  years  lived  from  age  20  to  64  years  and  adjusted  for  educational  attainment,  learning  or  education  quality,  and  functional health status using rates specific to each time period, age, and sex for 195 countries from 1990 to 2016. We estimated  educational  attainment  using  2522  censuses  and  household  surveys;  we  based  learning  estimates  on  1894  tests  among  school-aged  children;  and  we  based  functional  health  status  on  the  prevalence  of  seven  health  conditions, which were taken from the Global Burden of Diseases, Injuries, and Risk Factors Study 2016 (GBD 2016). Mortality rates specific to location, age, and sex were also taken from GBD 2016.

Findings: In 2016, Finland had the highest level of expected human capital of 28·4 health, education, and learning- adjusted expected years lived between age 20 and 64 years (95% uncertainty interval 27·5-29·2); Niger had the lowest expected  human  capital  of  less  than  1·6  years  (0·98-2·6).  In  2016,  44  countries  had  already  achieved  more  than  20 years of expected human capital; 68 countries had expected human capital of less than 10 years. Of 195 countries, the ten most populous countries in 2016 for expected human capital were ranked: China at 44, India at 158, USA at 27, Indonesia at 131, Brazil at 71, Pakistan at 164, Nigeria at 171, Bangladesh at 161, Russia at 49, and Mexico at 104. Assessment of change in expected human capital from 1990 to 2016 shows marked variation from less than 2 years of progress in 18 countries to more than 5 years of progress in 35 countries. Larger improvements in expected human capital appear to be associated with faster economic growth. The top quartile of countries in terms of absolute change in  human  capital  from  1990  to  2016  had  a  median  annualised  growth  in  gross  domestic  product  of  2·60%  (IQR 1·85.3·69) compared with 1·45% (0·18.2·19) for countries in the bottom quartile.

Interpretation: Countries vary widely in the rate of human capital formation. Monitoring the production of human capital can facilitate a mechanism to hold governments and donors accountable for investments in health and education.

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Human capital refers to the attributes of a population that, along with physical capital such as buildings, equip­ment, and other tangible assets, contribute to economic productivity. Human capital is characterised as the aggregate levels of education, training, skills, and health in a population, affecting the rate at which technologies can be developed, adopted, and employed to increase productivity.


My comment: In the background, first sentence, "Human capital is recognised as the level of education and health in a population," but in the second sentence in the paper, body, "Human capital is characterised as the aggregate levels of education, training, skills, and health in a population." It is much more complex to measure "aggregate levels of education, training, skills, and health in a population" than to measure just "the level of education and health in a population."

How this came to be? If you say that HC is education, training, skills, and health, is Cuba above Russia in human capital? Really? And North Korea above Egypt? Palestine above Iran? And Brunei above the UK, New Zealand, Italy and Israel? And Malta above China and Russia? What the reviewers say about these strange results?