This is excellent news for Russia, because an economy's human capital serves as its primary basis for wealth creation. However, considerable evidence indicates that Russia's human capital base is rapidly eroding. Trained scientist and engineers, lacking access to modern commercially viable technology and market infrastructure, are earning higher wages as taxi drivers, kiosk clerks and maids than in their areas of expertise. Many of Russia's brightest stars have emigrated in search of better lives. Young people, observing the poor earnings of the educated and confronting an education system designed by the Soviet regime which is badly out of sync with the economy's current and future needs, are naturally investing very lightly in their own education.
Educational attainment has a strong tendency to perpetuate itself within families and societies.
For example, well-educated parents are generally much more successful in educating their children than are poorly educated parents. Russia's foundation for future prosperity is quickly eroding. The task of rebuilding Russia's human capital, after a serious deterioration, would last several generations and be very costly. Fortunately, relatively moderate investment in maintaining and transforming Russia's human capital can prevent and reverse the deterioration under way. This follows from the tendency for a society's human capital to persist combined with the fact that Russia is still a well-educated nation.