Project report
Methodology for a World Bank Human Capital Index
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Summary
Written by AI, not yet AICS's view · claude-sonnet-5-5This paper sets out the method behind the World Bank Human Capital Index (HCI). The index combines health and education indicators into one number for the human capital a child born today can expect to reach by age 18, given the health and education risks in the country where she lives. Scores run from 0 to 1 and are measured against a benchmark of complete education and full health. A score of x means the child is expected to be x times 100 percent as productive as a future worker as she would be with complete education and full health. The method draws on the development accounting literature.
Key points
- The HCI combines health and education indicators into a single measure.
- It describes the human capital a child born today can expect to have by her 18th birthday.
- It reflects the risks of poor education and health in the child's country.
- Scores range from 0 to 1 and are measured against a benchmark of complete education and full health.
- The methodology is anchored in the development accounting literature.
Limitations
Only the abstract is available, so the specific indicators, data sources, assumptions and country results are not described. It also does not say which countries are covered.
Abstract
This paper describes the methodology for a new World Bank Human Capital Index (HCI). The HCI combines indicators of health and education into a measure of the human capital that a child born today can expect to obtain by her 18th birthday, given the risks of poor education and health that prevail in the country where she lives. The HCI is measured in units of productivity relative to a benchmark of complete education and full health, and ranges from 0 to 1. A value of x on the HCI indicates that a child born today can expect to be only x x100 percent as productive as a future worker as she would be if she enjoyed complete education and full health. The methodology of the HCI is anchored in the extensive literature on development accounting. (World)