Published on Monday, September 8, 2025 | Updated on Monday, September 8, 2025
Global | Human Capital: an essential engine of prosperity
Summary
Human capital accounts for most of the productivity differences across countries. Investing in education boosts innovation, attracts investment, reduces inequalities, and is the most effective policy for securing long-term growth, social cohesion, and shared prosperity.
Key points
- Key points:
- Microeconomic evidence shows that an additional year of education raises lifetime productivity and earnings; on average, it increases wages by 8% to 10%.
- Educational quality is as important as quantity: countries with similar schooling paths diverge widely in productivity depending on the knowledge and skills acquired.
- In the OECD, human capital accounts for about 75% of productivity differences. Its effects are both direct (higher output per worker) and indirect (attracting investment and enabling more efficient use of technology).
- Investing in talent means investing in prosperity and social cohesion: it requires improving educational quality from early childhood, strengthening higher and vocational education, and promoting lifelong learning for a changing labor market.
Geographies
- Geography Tags
- Global
Topics
- Topic Tags
- Social Sustainability
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