1. Stuck in the Middle?
Human Capital Development and Economic Growth
in Malaysia and Thailand

2. Sustainable Economic Growth
• The role of human capital formation in the
quest to sustain economic growth
• Good education system is fundamental to
equip workers with market skills
• Focus on Malaysia and Thailand

3. Middle Income Trap
If a country reaches a certain level of living standard
but grow rate lose momentum, it may be in “middle-
income trap” and would not advance to high-income
status.

5. Role of education in economic growth
- Output depends upon both quantity and quality of
human capital
-Human capital is endogenous
-Positive association between test score and economic
growth

6. What types of skills might middle income
countries require to maintain momentum?
A system stresses “STEM”
S- Science
T- Technology
E- Engineering
M-Mathematics

7. Creating a robust middle class is crucial
for long-term growth.
Middle class and long-term economic growth

8. Case studies

11. Quality of education

13. Economic Benefits of human capital
Private – Better jobs, higher wages
Social – Technology change and diffusion,
health and life expectancy

14. Rate of return:
The rate of return to each year of additional schooling in Thailand
is more than double compared to Korean and Singapore which
reflect the scarcity of skilled workers.

15. - Set budget priorities
- Reward teacher appropriately
- Avoid inflexible tracking of students
- Provide autonomy with accountability
- Invest in early childhood development
- Finance higher education appropriately
Education and the Options for Growth Prospects

16. Thanks