TRANSFORMATION OF HUMAN CAPITAL IN UKRAINE: THE ROLE OF SOCIAL TRUST AND ECONOMIC FACTORS IN POST-WAR RECOVERY

Abstract

The significance of this research stems from the urgent necessity to identify new catalysts for Ukraine's post-war economic recovery. Human capital is recognized as the fundamental asset for reconstruction; however, Ukraine faces a complex economic paradox: despite high indicators of formal education among the population, labor productivity remains critically low compared to European averages. The objective of this study is to scrutinize the theoretical, methodological, and practical underpinnings of human capital development within the landscape of digital transformation and to determine how social trust influences economic efficiency. The methodological basis of the research includes a structural-dynamic analysis of key human development indicators (income levels, GDP, unemployment, and demographic structure) for the period 2012–2022. To verify the hypotheses, correlation and regression analyses were employed to determine the strength of the relationship between economic factors and population income. Additionally, the study utilizes sociological data analysis to assess the level of institutional trust and its impact on labor productivity. The study reveals a strong correlation between income dynamics in Ukraine, average wages (r=0.999), and GDP per capita (r=0.995). The constructed regression model (R2≈0.99) quantitatively demonstrates that a 1% increase in unemployment results in a decrease in population income by UAH 46.2 billion. Furthermore, the research highlights a significant distortion in the structure of social capital, termed "trust dualism": high trust in defense institutions and volunteers stands in sharp contrast to critically low trust in regulatory state bodies. This disparity generates "institutional traps" and escalates transaction costs, thereby impeding the conversion of individual competencies into macroeconomic gains. Additionally, the prevalence of "bonding" social capital over "bridging" capital restricts access to resources and innovation. The practical significance of this article is anchored in its strategic recommendations for human capital transformation. The author proposes mechanisms for the 'digitalization of trust,' specifically through expanding the 'Diia' ecosystem to mitigate corruption risks, advancing decentralization to cultivate local trust, and modernizing education to emphasize soft skills. These measures aim to translate human capital from a latent resource into a tangible engine of economic growth for Ukraine’s post-war recovery.