Asia Minute: Many Asian Economies Outpace U.S. Investment in “Human Capital”

Sep 26, 2018

Nanjing Road, Shanghai
Credit Yun Huang Yong / Flickr

There are many ways to measure a country’s progress. It’s not limited to economic growth or per capita income, or even lifespan. A new study looks at a different measure — and the United States is slipping while China is gaining ground.

The World Bank commissioned a study looking at how much countries invest in their people when it comes to “human capital” – spending on education and health. The measure of that investment: the number of years an average citizen can be expected to work at peak productivity.

Several nations in the Asia Pacific have improved over roughly the last quarter century. China moved from number 69 in the global rankings to number 44.

One country that has tumbled: the United States — going from number six in the world to number 27. The biggest contributor to that fall: declining investment in education.

The study says education is vital to a country’s development since it affects “the rate at which technologies can be developed, adopted and employed to increase productivity.”

The World Bank recently started the “Human Capital Project” to “understand the link between investing in people and economic growth.”

Northern Europe tops the rankings: Finland, Iceland, Denmark and the Netherlands. Taiwan and South Korea are five and six, followed by Norway, Luxembourg, France and Belgium.

Assembly at a school in Singapore
Credit mailer_diablo. / Wikimedia Commons

Singapore and Japan make the top fifteen and Australia is one level above the United States at number 26. Several African nations are at the bottom, along with Afghanistan.

The results were published this week in the British medical journal The Lancet.