Human Capital or a High-Stakes Casino?

Human Capital or a High-Stakes Casino?

"The wealth of nations depends chiefly on the skill, dexterity and judgment of its people." — Adam Smith

According to Gary Becker's Human Capital Theory, education is an investment that enhances productivity. Michael Spence's Signalling Theory adds that competitive examinations should credibly signal this investment by separating genuine talent from the crowd. But a signal has value only if it cannot be manipulated.

What happens when the signal itself is compromised?

The NEET paper leak, the youth-led Cockroach Janta Party (CJP) movement, and Sonam Wangchuk's campaign for institutional reforms are not merely education controversies—they expose a deeper macroeconomic problem: institutional failure.

When examinations lose credibility, merit gives way to uncertainty, skill-building gives way to exam survival, and productive years disappear into repeated attempts. Economists describe this as deadweight loss—scarce time, money, and talent are diverted without creating corresponding economic value. The economy loses not just successful candidates, but innovators, entrepreneurs, researchers, and productive workers.

Institutional economist Douglass North called institutions the "rules of the game." If the rules governing talent allocation are repeatedly questioned, rational students stop optimising for learning and start optimising for uncertainty. A demographic dividend cannot emerge from a system where talent is allocated like a market—but increasingly feels like a lottery. A trillion-dollar economy deserves institutions that reward merit, not merely luck.