Human Capital Formation in India
Investments in education convert human beings into human capital.
Sources of human capital-
1. Education-when a person is educated he gathers the ability to produce more and income will raise. The labour skill of educated person is more than the labour skills of an uneducated person.
2. Health-A healthy person can contribute more and be regular than a sick person.
3. On the job training-the worker is trained in his job itself to make him more skillful. They are sent for of campus training.
4. Migration-people migrate from place to place to present their talent or qualification and for getting a suitable work.
5. Information-people wants to gather information about labour market. The information’s are provided though televisions, newspaper etc.
Human Capital and Economic growth-
Economic Growth refers to increase in real national income of country, so the contribution of the skilled person to economy is more that that of an illiterate. So, increase in human capital means increase in economic growth.Economic Growth may be the cause of Human Capital Formation or Human Capital Formation may be the cause of Economic Growth.Both are interdependent.
Human capital and Human development-
Human capital is a mean to achieve human development by investment in education and health. Human development is referring towards the comfortable livelihood arrived by human capital formation.
Human capital formation refers to increase in stock of skill, expertise etc.
Education institutions-National council of educational research and training(NCERT), University grants commission(UGC),and All India council of technical education (AICTE).
Health Institution- Indian council of medical research (ICMR).
-Percentage of government expenditure 1952-2002 increasing from 7.92-13.17 of total expenditure of government.
-percentage of GDP 1952-2002 increased from 0.64-4.02.
-Expenditure achievements in India - 1. Adult literacy rate.
-2. Primary completion rate
-3.Youth literacy rate.
Physical capital-it refers to the physical tools provided by nature to produce goods. eg; machinery.
it is separable and can be mobilized easily.
Government intervention is required in providing of education and health-Both are very sensitive matter. if the responsibility of providing education and health given to the private sector we can't be sure that everyone could take benefit of it. Private sector works for profit motive. And because of this they may raise the cost of education and health which poor people can't afford.
Secondly there impact can not be reversed.
That is why government intervention is required so that every one could gather benefit.
