'Human capital' (economics) Essay Example | Topics and Well Written Essays - 500 words

Human capital (economics) - Essay ExampleLabor productivity refers to the amount of railroad siding produced per unit time. It is a measure of economic growth for a country. One of the factors which are shown to contribute positively towards increased labor productivity is human capital. several(prenominal) studies at the macro as well as the micro level have been conducted which show a positive relationship between the investment in human capital and productivity i.e. the better the quality of human capital the high the earnings as well as the capability to generate effective output. Studies by Becker (1964), Schultz (1961) and Miner (1971) have proven that there exists a positive relationship between human capital and labor productivity which then translates into higher economic growth. investiture in human capital increases workers efficiency and it helps produce better quality products at lesser costs which contribute to economic growth.Investment in human capital ensures that workers are aware of production methods and technologies. This prevents them from wasting precious business resources which enhances productivity. When the labor productivity is higher, there is more output open for the country to market and sell. This increased capability then translates into higher local and international earnings thus speeding up economic growth.Recently, economies such as the Philippines, Malaysia and Thailand etc. have proven the importance of investiture in human capital. These economies have sped up their economic growth rates tremendously by investing in education and training for its labor force thus highlighting the positive relationship between human capital, labor productivity and economic