Human Capital Theory and Education
The title of my presentation is “Human Capital Theory and Education”.My presentation is composed of three parts,including human capital theory,the relationship of human capital and education and education investment.
The first part is human capital theory,Human capital theory formed in 1960s,and what is capital theory? Human capital refers to the intangible capital of the laborer, expressed as the quantity and quality of a laborer, as workers in a certain period of time have a good health, operation skills and proficiency.Human capital theory has four main points,The first is human resource is the most important resource, human capital theory is the core issue of economics. Human capital is more effective than physical capital in economic growth.The second is human capital investment is proportional to the national income. The reward of investment on human capital is more than physical capital.The third is the core of human capital is to improve the population quality. Education investment is the main part of the human capital cation is the basic way to improve human capital.The fourth is education investment should be based on market supply and demand,and the measure symbol is human price floating.Then the representatives are Theodore schultz and Gary becker.Schultz explained the mystery of economics growth with the human capital theory , declared the birth of the human capital theory. He thinks, to strengthen human capital investment and improve the quality of population is the key to promote economic growth.And Becker proposed the concept of the direct and indirect costs of cultivating child,the concept of family time value and time allocation, the concept of market and non-market activities in the family.
The second part is the relationship of human capital and education,it has three points,the first is education is an important source of human capital investment. The quality of human capital is not only depending on the quantity but more on the quality of education investment.The second is from the perspective of population quality improvement,education is the key to improve the population quality.The third is in the human capital theory,the economic value of education and life function is prominent, and demonstrates that improving the ability of man's knowledge through education is the fundamental power of economic growth.The fourth is human capital theory established the extremely important status of contemporary economic study and social development , and performs the function of education greatly.
The third part is education investment,it is divided into three points.The first is the cost of education investment.It includes monetary cost and non-monetary cost.Monetary cost includes direct cost and indirect cost.Direct cost are the direct fee to accept education ,like tuition and book costs,etc .Indirect cost, also called opportunity costs,which means one is unable to work to get income due to education.Non-monetary cost refers to the psychological cost due to education.The second is education investment profits,it includes economic benefits and non-economic profits.So,what is economic benefits?From the point of lifetime income, the income of those who have received education is higher than those who lack of education.Non-economic profits includes the improvement of social status, knowledge expansion brought about broadening the interest of life and so on.The third is the conclusions of education investment costs and benefits.The first is education cost
affects the education investment demand, the rising cost of education make the education demand decline.The second is the size of the income stream will affect education decision. Other factors fixed, the income gap between university graduates and workers without a university diploma gets bigger, will increase the number of people going to university.The third is that age is one of the factors that affect education investment decisions.
In conclusion,good health,knowledge, skills and other abilities of a person are very important resources.In order to enhance competitiveness,we are supposed to increase the education investment and it will never be out of date.。