Interdisciplinary Social Research

Human capital represents one of the most important components of a nation’s wealth and it is critically important for the economic growth of a nation and its overall well-being. From a business organizational standpoint, developing human capital is vital to improve and sustain organizational competitiveness. Building human capital of a nation and specifically that of organizations, in turn, requires investing on education. However, it is not always clear what investments should be prioritized to improve human capital through the pathways of education. The study explores the key factors shaping the learning outcomes in Ethiopian primary schools, as a way to look at human capital development. Data for this study is gathered by using 400 random schools from nationwide school database and through carrying out qualitative research with several cases. Using the education production function approach, the author uses regression analysis and ANOVA to find the major reasons why students did well or poorly in grade 8 Standardized Mathematics National Exams. The research found that schools’ water availability, existence of science center and student-textbook ratio, school ownership type, gender, and teacher qualification can influence the performance of students in learning outcomes. Alternatively, most common assumptions, including the importance of principals’ leadership training, education levels and experience, and school location in terms of urban or rural areas, were not backed up by the statistics. It emphasizes that focusing investment on infrastructure and learning resources leads to better learning outcomes. Evidence-based education patterns and welltargeted donor actions are necessary to increase the effectiveness of school programmers and achieve greater gains in human capital through investments in the education sector.