ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Human capital affects economic growth and can help to develop an economy by expanding the knowledge and skills of its people. The level of economic growth driven by consumer spending and business investment determines the amount of skilled labor needed.

Detailed explanation-2: -Investment in education and on-the-job training helps to impart these skills and enhance the knowledge base and thus helps in the absorption of new technologies which leads to higher production and thus economic growth. Thus it is evident that human capital contributes to economic growth in various ways.

Detailed explanation-3: -Human capital allows an economy to grow. When human capital increases in areas such as science, education, and management, it leads to increases in innovation, social well-being, equality, increased productivity, improved rates of participation, all of which contribute to economic growth.

Detailed explanation-4: -Population becomes human capital when there is investment made in the form of education, training and medical care. In fact, human capital is the stock of skill and productive knowledge embodied in them.