The Contribution of Human Capital to Current and Future Growth - An Extension of the World Bank’s Long-Term Growth Model (LTGM-HC)

Oct 15, 2026

Uploaded by Bintang

The Long-Term Growth Model–Human Capital Extension (LTGM-HC) is a spreadsheet-based toolkit projecting workforce human capital for 153 countries from 2025 to 2100. It simulates pre-tertiary schooling, education quality, and health across age cohorts to quantify effects on current and future productivity. The model delivers estimates of current human capital growth, forecasts future growth slowdowns without reforms, and evaluates scenarios where reforms sustain gains.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages71

Reading Time2 h 59 min

AccessFree to download

Abstract

Introduction

Human capital as a driver of growth

| Policy Research Working Paper 11276
The Contribution of Human Capital to Current and Future Growth
An Extension of the World Bank’s Long-Term Growth Model (LTGM-HC)
Arthur Mendes
Steven Pennings | | | | | | --- | --- | --- | --- | --- | | |
Development Research Group & Prosperity Chief Economist’s Office December 2025 | | | | | | | | | A verified reproducibility package for this paper is available at [http://reproducibility.worldbank.org](http://reproducibility.worldbank.org) , click here for direct access. | Policy Research Working Paper 112276 Abstract This paper presents the Long-Term Growth Model–Human Capital Extension (LTGM-HC), a spreadsheet-based toolkit that projects the human capital of the workforce from 2025 to 2100 for 153 countries. The LTGM-HC simulates pre-tertiary years of schooling, education quality, and health across age cohorts and how they affect current and future workforce productivity. The paper also produces three sets of general results. First, it provides new estimates of the current rate of human capital growth, which differ substantially from those in the Penn World Tables. Global average human capital growth is almost 1 percent and is surprisingly similar across income groups, as greater historical gains in years of schooling in poorer countries are offset by lower initial school quality. Second, it provides new estimates of the pace of future human capital growth. Without future reforms, average human capital growth will slow by around 0.15-0.2 percentage points per decade, hitting zero by 2080 when today’s children begin to retire. In contrast, a scenario with a typical pace of reform almost halves the rate of decline. Finally, it provides new estimates of the contribution of human capital to current and future economic growth. Ina typical reform scenario, human capital growth is projected to raise annual GDP per capita growth by around half a percentage point over the next 75 years, leaving GDP per capita 45 percent higher by 2100. However, about twothirds of these gains reflect reforms that have already been enacted. An extension to include tertiary education raises human capital growth, and its contribution to GDP growth, by around 0.1-0.2 percentage points. This paper is a product of the Development Research Group, Development Economics and the Office of the Chief Economist, Prosperity Vertical. It is part of a larger effort by the World Bank to provide open access to its research and make a contribution to development policy discussions around the world. Policy Research Working Papers are also posted on the Web at [http://www.worldbank.org/prwp. The authors may be contacted at agalegomendes@worldbank.org and](http://www.worldbank.org/prwp. The authors may be contacted at agalegomendes@worldbank.org and)[ ](http://www.worldbank.org/prwp. The authors may be contacted at agalegomendes@worldbank.org and)[spennings@worldbank.org. A verified reproducibility package for this paper is available at](spennings@worldbank.org. A verified reproducibility package for this paper is available at) [http://reproducibility.worldbank](http://reproducibility.worldbank). org, click here for direct access. The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent. Produced by the Research Support Team The Contribution of Human Capital to Current and Futur

FAQs

What does the LTGM-HC model project and for which countries and years?

LTGM-HC projects human capital of the workforce for 153 countries from 2025 to 2100.

Which components does the model simulate to determine human capital effects?

It simulates pre-tertiary years of schooling, education quality, and health across age cohorts, and how these affect workforce productivity.

How do the results compare across reform and no-reform scenarios?

Without future reforms, average human capital growth slows and reaches zero by 2080; with a typical reform pace, the decline is about half as large.

Oct 15, 2026

Uploaded by Bintang