Economie et Statistique / Economics and Statistics n° 517-518-519 - 2020 Beyond and Around GDP: Questions to National Accounting
Why and How Should Human Capital be Measured in National Accounts?
Economie et Statistique / Economics and Statistics
Paru le :08/10/2020
There is currently a significant divergence in the way in which education expenditure is perceived in economic theory and in national accounting: the former treats it as investment, the latter as consumption. In fact, the accounting framework is still structured around two major production factors (labour and physical capital), whereas human capital appears to be essential if certain current phenomena are to be perceived accurately, notably the resurgence of inequality in certain countries. This paper presents the work undertaken to incorporate human capital into national accounts and explores the two main methods used: that based on costs (inputs) and that based on income (output). We go on to use the inputs method to estimate the savings rate of USA, French and British households when education and health expenditure is transferred to investment. Only the inclusion of health expenditure would enable the USA savings rate to be redressed significantly.
Article (pdf, 884 Ko )
Citation: Canry, N. (2020). Why and How Should Human Capital be Measured in National
Accounts? Economie et Statistique / Economics and Statistics, 517-518-519, 61–79.