October 12: A new research of the World Bank gives policymakers compelling evidence that delivering better outcomes in children’s health and learning can significantly boost the incomes of people—and of countries—with returns far into the future.

 A Human Capital Index, launched on Thursday, October 11,  at the World Bank-IMF Annual Meetings, shows that 56 percent of children born today across the world will lose more than half their potential lifetime earnings because governments are not currently making effective investments in their people to ensure a healthy, educated, and resilient population ready for the workplace of the future.

 Human capital—the knowledge, skills, and health that people accumulate over their lives—has been a key factor behind the sustained economic growth and poverty reduction rates of many countries in the 20th century, reads a statement issued by the World Bank.

 The Human Capital Index measures the amount of human capital that a child born today can expect to attain by age 18, given the risks of poor health and education that prevail in the country where he or she lives. The index measures each country’s distance to the frontier of complete education and full health for a child born today. The measure includes  survival  (will children born today survive to school age?),  school   (how much schooling will they complete and how much will they learn?), and   health   (will they leave school in good health, ready for further learning and/or work as adults?).

 Nepal’s score of 0.49 out of a maximum possible score of 1 means that a child born in Nepal today will be 49 percent as productive when she grows up as she could be if she enjoyed complete education and full health. The HCI highlights that Nepal is a good performer with respect to childhood survival: 97 out of 100 children born today survive to the age of five. A significant proportion of these children, however, suffer from stunting: 36 out of 100 children are stunted, meaning they carry a lifelong risk of cognitive and physical limitations. The education component of the HCI shows that children in Nepal can expect to complete 11.7 years of school by age 18. However, when years of schooling are adjusted for quality of learning, this is only equivalent to 6.9 years: a learning gap of 4.8 years.

 “Nepal’s human capital index is higher than the average for its region and income group, which is a positive sign,” said Faris Hadad-Zervos, World Bank’s country manager for Nepal. “To further improve this, the World Bank is committed to working with the Government of Nepal to mobilize better and more efficient investment in people to ensure a globally competent generation.”

 The Index is part of the World Bank Group’s Human Capital Project, which recognizes human capital as driver of inclusive growth.