Human Capital Measures in Economic Growth Studies: An Overview

Quantity and quality of human capital are important components of economic growth. However, assessing the relationship between human capital and growth is complicated both by the multidimensional nature of human capital itself, and by the fact that many of its characteri­stics are difficult to observe and to measure. Economic growth studies use various measures for different aspects of human capital – such as education, experience and health of workers. Choice of a particular measure depends largely on the objectives of the research, available data and established approaches; its motives and implications are often less visible, though. In this paper, I discuss human capital measures that are used in macroeconomic studies. The main ones include quantitative and qualitative characteristics of education, returns to education, cognitive skills test results, work experience and health of workers. Choice of a measure is reflected in differences in estimates of human capital impact on economic growth, ranging from the complete absence of any influence to the fairly high role of human capital as a factor of economic growth. This paper discusses the strengths and weaknes­ses and the peculiarities of the respective measures. Specific research results obtained using various approaches to human capital measurement are presented for illustrative purposes.