The birth of human capital theory was one of the most consequential paradigm shifts in modern economics. It represented the entry of economists into the world of education policy—an area that had, through about 1955, remained firmly in the hands of education specialists. But starting in the late 1950s, pioneering American economists like Theodore Schultz and Gary Becker began to convince their colleagues that education spending, formerly understood primarily as a consumption expense, was instead best classified as an investment in production. Human capital theory posited that the then-dominant models of economic growth, which focused on physical capital, had neglected the essential role of education and training in accounting for increased productivity. As Schultz wrote early in 1959, a “concept of capital restricted to tangible property will not do. A much more comprehensive concept of capital is required—one that will include human capital.”

The economization of education, or the application of economistic modes of analysis to education, upended global thinking about a domain that had previously been framed in terms of its religious, civic, or moral significance. 

Crucially, human capital theory was a set of ideas with immediate practical use to the decolonizing world. New nations, seeking to refute racialized charges of intellectual inferiority that had been used to legitimize colonial rule, were eager to mobilize new, economistic ideas of education and to harness education in development efforts as a counter to racist colonial discourses. Nearly contemporaneously with the intellectual revolution of human capital theory, a global stampede of education and manpower planners took off across Africa, South Asia, the Middle East, Latin America and southern Europe. Focusing on the 1955 to 1965 period, my project examines how the economization of education took root so swiftly “on the ground” in the developing world.