INSTITUTIONAL EVOLUTION OF HUMAN CAPITAL IN THE CONTEXT OF DIGITAL TRANSFORMATION

Abstract

This article examines the institutional evolution of human capital in the context of digital transformation. The study is based on a comprehensive methodological approach combining institutional economics, human capital theory, and digital economy concepts. Using a mixed-method approach, both qualitative and quantitative analyses were applied to assess the impact of digitalization on education systems, labor markets, and public policy. The findings indicate that digital transformation is significantly reshaping the structure and content of human capital, shifting the focus from traditional knowledge to digital competencies, adaptability, and lifelong learning. Empirical evidence shows rapid growth in the e-learning market, increasing demand for digital skills, and structural changes in employment due to automation. The study also highlights the growing role of state policies and investments in fostering human capital development in the digital era. In the case of Uzbekistan, the expansion of internet access and IT service exports demonstrates the strengthening link between digitalization and human capital. The results confirm that human capital has become a dynamic and continuously evolving system influenced by institutional changes. The paper concludes with practical recommendations aimed at strengthening lifelong learning systems, enhancing digital education, supporting reskilling initiatives, and reducing the digital divide to ensure sustainable economic development and global competitiveness.