Working Title: Towards the Development of a Human Capital Index: Structure, Methodology, and Comparative Insights with the Human Development Index

This study introduces the development of the Human Capital Index (HCI), a composite measure encompassing education, health, economic productivity, and education quality, to assess socioeconomic capacity across Montenegro, Thailand, Malaysia, and Indonesia. Leveraging datasets from international organizations, this research employs predictive modeling, causal analysis, and multicollinearity diagnostics to explore disparities and trends in human capital development. Principal Component Analysis (PCA) and Ridge Regression are utilized to refine the index, while Difference-in-Differences (DiD) methodology assesses the impact of the COVID-19 pandemic. Findings reveal significant differences in HCI values, with Montenegro and Malaysia outperforming in health and economic productivity, while Indonesia shows room for improvement in education and quality indices. The analysis underscores the importance of integrated policy approaches targeting education, health, and economic productivity to foster resilient and inclusive human capital development. This work provides actionable insights for policymakers to address regional disparities and align with Sustainable Development Goals (SDGs).