The Effect of Increasing Human Capital Investment on Economic Growth and Poverty : A Simulation Exercise

Collin, Matthew ; Weil, David

World Bank, Washington, DC

关键词: HUMAN CAPITAL;    ECONOMIC GROWTH;    POVERTY REDUCTION;    EDUCATION SPENDING;   

DOI  :  10.1596/1813-9450-8590
RP-ID  :  WPS8590

学科分类：社会科学、人文和艺术（综合）

来源: World Bank Open Knowledge Repository

【 摘 要 】

This paper examines the dynamicresponses of income and poverty to increased investment inthe human capital of new cohorts of workers, using aquantitative macroeconomic model with realistic demography.Compared to a baseline in which the rate of human capitalinvestment currently observed in every country remainsconstant, the paper examines two alternative scenarios: onein which each country experiences a rate of growth of humancapital investment that is typical of what was observed inthe decade ending in 2015, and one in which each countryraises human capital investment at a rate corresponding tothe 75th percentile of what was observed in the data. In theformer, world GDP per capita is 5 percent higher thanbaseline in the year 2050, while the global rate of $1.90poverty is 0.7 percentage points lower in that year. In thelatter, world GDP per capita is 12 percent higher thanbaseline in 2050, while the rate of $1.90 poverty drops by1.4 percentage points. These gains are concentrated in poorcountries. The paper argues in the context of our model thatinvesting in people is more cost effective than investing inphysical capital as a means to achieve specified income orpoverty goals.