investment in lifelong learning will be needed to facilitate the training and retraining required for people to meet shifting demands for skills (World Bank 2019c). Improving learning outcomes also requires better measurement and monitoring, more efficient teaching practices, and greater accountability (World Bank 2018c). In LICs, investment in early childhood education can ensure that cognitive and socio-behavioral skills are adequately developed, since addressing deficiencies later in life tends to be much more expensive (World Bank 2019a). To reap the benefits of digital technologies, LICs will require significant investment in human capital.

Reforms to strengthen competition could have synergies with reforms to improve human capital. Firms in EMDEs tend to innovate in marginal process and product improvements rather than engaging in significant technology adoption or new product imitation (Cirera and Maloney 2017). This can partly be attributed to weak managerial capabilities. Better education, especially if combined with more competition, can induce an upgrading of managerial skills that can foster more ambitious innovations.

Finally, better education serves a critical function in reducing inequality both within and between countries. As EMDEs’ workforce grows—while that of advanced economies shrinks—and becomes more skilled, the global economy is expected to benefit and global income inequality is expected to fall (World Bank 2018a).

# 4.4.2 Improve health care

Human capital can be improved by reducing malnutrition and improving health care services. Policy interventions to improve public health, and to ensure and lengthen productive working lives, range widely. Better sanitation and access to clean water would improve public health: 9 percent of the global disease burden may be attributable to unsafe water, inadequate sanitation, and insufficient hygiene (WHO 2008). Improvements in health-care provision can be spurred by well-defined and regularly monitored performance indicators (Bradley et al. 2010). Comprehensive provision of health services has been followed by better health outcomes in countries with higher per capita incomes (Maeda et al. 2014). At the local level, programs targeted at local health service providers or groups of patients have generated considerable improvements in health care services and outcomes. For example, in Rwanda, performance-based incentive payments helped significantly improve health indicators for children (Gertler and Vermeersch 2012). In India, enhanced training of primary health care providers led to better identification and treatment of patient ailments (Das et al. 2016).

# 4.4.3 Close infrastructure gaps.

EMDEs have large infrastructure needs that require financing (Rozenberg and Fay 2019). In many EMDEs, access to water and sanitation remains incomplete, power outages are common, access to communication networks is limited, and rail infrastructure is underdeveloped. It is estimated that unfilled global investment needs amount to up to 3 percent of global GDP, and progress towards closing them has been slow during 2014-19, especially in the areas of water, sanitation, and education (UNCTAD 2014, 2019). EMDEs with sound fiscal positions could increase public sector investment, which would both boost short-term demand and help raise potential growth in the long-run.

EMDEs that are constrained by fiscal sustainability considerations or high debt could