ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Human capital consists of the knowledge, skills, and health that people invest in and accumulate throughout their lives, enabling them to realize their potential as productive members of society.

Detailed explanation-2: -The concept of human capital investment is mainly investment done by a firm or an individual on education/training and to expect a return of that investment in terms of revenue/capital. Human capital consists of three main components: ability, earlier education, and knowledge gained by training on job premises.

Detailed explanation-3: -The theory states that education increases people’s general mental capabilities and technical skills, thereby increasing their pro-ductive potential in the labor force. It follows that schooling is an investment and that people are an important repository of capital and not just a source of raw labor.

Detailed explanation-4: -On-the-job training is a source of human capital formation as it increases the skill and efficiency of the workers and leads to an increase in production and productivity.