How Closely is the Distribution of Skills Related to Countries' Overall Level of Social Inequality and Economic Prosperity?

A country’s level of human capital – the knowledge and skills in the population – has a strong bearing on its economic potential for growth and prosperity. On the other hand, its level of social inequality might prevent prosperity to be shared in equitable ways across the population. This papers looks at the relationship between the distribution of numeracy skills in the population to measures of economic prosperity (per capita GDP) and social inequality (Gini coefficient). Country-level correlations between various measures of the skills dispersion and these two indicators are presented. The correlations suggest that a higher numeracy skills dispersion is related to higher social inequality. A higher share of low-skilled adults relates positively with greater social inequality, while a higher share of high-skilled adults seems to be related with higher levels of economic output.