HUMAN CAPITAL FINANCING: LESSONS FROM THE USA AND THE EU AND IMPLEMENTATION PROSPECTS IN POST-WAR UKRAINE

Abstract

This paper develops an evidence-based framework for financing human capital development in post-war Ukraine by extracting, synthesising and adapting the most effective instruments employed in the United States and the European Union. Relying on panel data provided by OECD, Eurostat, World Bank, WHO and the US National Center for Science and Engineering Statistics for 2010-2024, the study combines systemic, comparative and case-study approaches to quantify macroeconomic effects and to reveal institutional mechanisms that underlie successful reforms. Particular attention is paid to Poland’s comprehensive secondary-school reform that lifted PISA (Programme for International Student Assessment) scores by thirty-five points within six years and raised graduates’ lifetime earnings; to the US Affordable Care Act, which almost halved the share of uninsured citizens and reduced mortality among low-income adults; to the British Sure Start programme that generated a documented fiscal return of 2.05 pounds for every pound invested in early-childhood services; to the Horizon 2020 research and innovation framework, whose projects are expected to add 429 billion euros to EU (European Union) GDP (Gross Domestic Product) by 2040; and to Germany’s Hartz I–IV labour-market package, which cut structural unemployment by more than three percentage points. The cross-country benchmarking and factor analysis demonstrate that when public expenditure on education, health and R&D reaches at least twelve per cent of GDP and is supplemented by well-designed tax incentives and public-private partnerships, the Human Capital Index rises by 0.06 points and potential output growth accelerates by 0.7 percentage points annually. Based on these findings, the article proposes a four-pillar roadmap for Ukraine: first, a one-year extension of basic secondary schooling accompanied by digital competence standards and nationwide testing; second, the enactment of a veteran education voucher modelled on the US Post-9/11 GI Bill (Servicemen’s Readjustment Act) and combined with a Build-Back-Better apprenticeship scheme in the construction sector; third, a gradual increase of competitive public R&D grants to 1.5 % of GDP, aligned with Horizon Europe co-funding mechanisms and focused on dual-use technologies; and fourth, the establishment of municipal early-childhood hubs in war-affected communities to counteract demographic losses and reinforce social cohesion. The originality of the research lies in its integrated vision: unlike previous studies that treat education, health care, labour policy or innovation finance in isolation, this article constructs a single financing matrix that links all stages of the life cycle and explicitly accounts for post-war fiscal constraints, demographic shocks and EU accession requirements. The conclusions highlight that targeted, multi-channel investment in people constitutes the fastest and fiscally sustainable pathway to restoring Ukraine’s productive capacity, fostering inclusive growth and embedding the country within the European knowledge economy.