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Human capital, unequal opportunities and productivity convergence: A global historical perspective, 1800-2100

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  • Bharti, Nitin Kumar
  • Gethin, Amory
  • Jenmana, Thanasak
  • Mo, Zhexun
  • Piketty, Thomas
  • Yang, Li

Abstract

This paper constructs a new global historical database on public expenditure and revenue and their components-particularly education and health expenditure-covering all world regions over the 1800-2025 period. We document a large rise of human capital expenditure (as % of GDP) in all parts of the world in the long run, but with enormous and persistent inequality between regions. Public education expenditure per school-age individual in Sub-Saharan Africa is about 3% of the level observed in Europe and North America in 2025 in PPP terms (versus 6% in 1980 and 4% in 1950). We also find a large impact of human capital expenditure on productivity growth over the 1800-2025 period, especially for public education and for poor countries. Estimated returns using our macro-historical database are around 10% or more, in line with micro studies. Finally, we present simulations based on alternative human capital expenditure trajectories over the 2025-2100 period. In particular, we analyze the conditions under which convergence in human capital expenditure could lead to global productivity convergence by 2100 (around 100€ per hour in all regions in our benchmark scenario).

Suggested Citation

  • Bharti, Nitin Kumar & Gethin, Amory & Jenmana, Thanasak & Mo, Zhexun & Piketty, Thomas & Yang, Li, 2025. "Human capital, unequal opportunities and productivity convergence: A global historical perspective, 1800-2100," ZEW Discussion Papers 25-049, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:330312
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    References listed on IDEAS

    as
    1. Bas Van Leeuwen & Peter Foldvari, 2008. "Human Capital and Economic Growth in Asia 1890–2000: A Time‐series Analysis," Asian Economic Journal, East Asian Economic Association, vol. 22(3), pages 225-240, September.
    2. Card, David, 2001. "Estimating the Return to Schooling: Progress on Some Persistent Econometric Problems," Econometrica, Econometric Society, vol. 69(5), pages 1127-1160, September.
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    JEL classification:

    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • H5 - Public Economics - - National Government Expenditures and Related Policies
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development
    • N10 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - General, International, or Comparative

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