Gary Becker


Human capital

Posted by on August 12, 2017  /  0 Comments

LIRNEasia has a human capital research focus. In this context, the Economist’s succinct exposition of the ideas of Gary Becker is worth reading: Simply put, human capital refers to the abilities and qualities of people that make them productive. Knowledge is the most important of these, but other factors, from a sense of punctuality to the state of someone’s health, also matter. Investment in human capital thus mainly refers to education but it also includes other things—the inculcation of values by parents, say, or a healthy diet. Just as investing in physical capital—whether building a new factory or upgrading computers—can pay off for a company, so investments in human capital also pay off for people.