Knowra Human capital Human capital Human capital is the knowledge, skills, and abilities embodied in people that contribute to their productive capacity. It can grow through education, training, health, and experience.
Human capital formation : The accumulation of knowledge, skills, abilities, and health that can raise a person’s productive capacity. Education, training, health, and experience build the capacities that constitute human capital.
Adam Smith : An eighteenth-century Scottish economist and philosopher, author of The Wealth of Nations. Smith included acquired abilities among the components of a nation's productive wealth.
Returns to education : The financial and nonfinancial benefits associated with additional education. Wage gains are a common measure of the payoff to educational investment.
Physical capital : Produced assets, such as machinery and buildings, used to make goods and services. It is a productive resource like human capital, but it is embodied in objects rather than people.
Wage inequality : Differences in wages among workers or groups of workers. Unequal access to skill-building opportunities can contribute to wage differences.
Education : The process of developing knowledge, skills, values, and understanding through teaching and learning. Schooling develops knowledge and abilities that can raise productivity.
Theodore W. Schultz : An American economist who studied agriculture, education, and economic development. Schultz helped establish investment in people as an explanation of economic growth.
Mincer earnings function : A statistical model relating earnings to schooling and work experience. It estimates how human-capital measures correspond to observed wages.
Social capital : Resources available through relationships, networks, and shared norms. It emphasizes connections among people rather than their individual knowledge and abilities.
Intergenerational mobility : Changes in socioeconomic position between parents and their children. Family resources influence access to education and other ways of building human capital.
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