Human capital is the central determinantof economic well-being and social advancement in the modernglobal economy. The key characteristic that distinguishesbetween advanced economies, middle-income economies andlow-income economies is the knowledge content of theireconomic activities and production processes. Industry,agriculture and especially services have become increasinglyknowledge and skill intensive in recent years. Further, thedominance of knowledge and skills is increasing at anaccelerating rate. Among advanced economies, for instance,the education levels of their populations is the single mostimportant factor determining their economic performance[Hanushek and Welch (2006), Hanushek and Woessmann (2008)].Among middle-income and low-income countries, too, economiesthat have high education attainment enjoy considerablewelfare gains [Fasih (2008), Patrinos and Psacharopoulos(2011)]. Human resource development is particularlyimportant for the economic development of small states[Martin and Bray (2011)]. Education also produces a varietyof social benefits. These include healthier and betternourished families and children; the creation of theenlightened citizenry needed for a modern liberal democracy;and the promotion of social mobility [OECD (2012)]. Thispaper offers an overview of the general education system andthe current status of access and participation in theMaldives. This is followed by a discussion of the economicand social benefits of investment in education. The paperconcludes by discussing options to expand access andparticipation at education levels where the Maldives lagsbehind other comparable small island economies.
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