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ArticleOpen Access http://dx.doi.org/10.26855/ssp.2026.06.006

Welfare Regimes and Human Capital Index Dynamics in Developing Countries

Karasev Dmitry Yuryevich

Russian Presidential Academy of National Economy and Public Administration (RANEPA), Moscow 119571, Russia.

*Corresponding author: Karasev Dmitry Yuryevich

Published: June 2,2026

Abstract

Previous research indicated that public spending on health, education, and social protection in developing countries very weakly, if they are at all, correlated with their human capital outcomes. Thus, it is unlikely that developing countries could close the gap in human capital with OECD countries through additional government social spending. This paper is motivated by an attempt to correct and improve this conclusion. The literature on the international and comparative social policy and welfare regimes in developing countries showed that their social spending priorities vary considerably. This paper investigates how developing countries' social spending priorities, operationalized via their welfare clusters, influenced their human capital outcomes in terms of the World Bank Human Capital Index components. Hypotheses describing these influences and their differences between productive and protective welfare clusters were tested with regression analysis of the panel dataset on 22 developing countries for 7 benchmark years (from the 2000 to the 2019), including 26 indicators. The findings confirm that social spending priorities matter and that these priorities of developing countries with productive welfare better transform into human capital outcomes (at least in some sub-components and before they reach some threshold levels). Unfortunately, there are also some unintended consequences of productive welfare that restricts its stock of human capital.

Keywords

International comparisons; regression analysis; developing countries; welfare re-gime; human capital; effectiveness of social spending; late development

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How to cite this paper

Welfare Regimes and Human Capital Index Dynamics in Developing Countries

How to cite this paper: Karasev Dmitry Yuryevich. (2026). Welfare Regimes and Human Capital Index Dynamics in Developing Countries. Sociology & Social Policy3(1), 44-58.

DOI: http://dx.doi.org/10.26855/ssp.2026.06.006