Showing papers on "Human capital published in 1968"

Institutions and the Rising Economic Value of Man

Abstract: I TAKE it to be true that there is a strong connection between the investment in human capital and the secular rise in the economic value of man. The institutional implications of this development are, however, far from clear. My purpose is to show that the rise in the economic value of human agents makes new demands on institutions, that some political and legal institutions are especially subject to these demands, that there are lags in adjusting to the new demands and these lags are the key to important public problems, and that economic theory is a necessary analytical tool in clarifying and solving these problems. It might be said that human capital is protesting the status quo of institutions as it seeks participation rights for itself. Be that as it may, there is enough historical perspective to see that the ownership of land is declining as a source of economic leverage, and so is the ownership of physical capital relative to that of human capital. We have long known that Ricardian rent is not the fulcrum of economic values; nor is physical capital the critical historical factor, as Marx believed. The institutions governing private rights in land and in other forms of physical capital when Ricardo and Marx made their contributions would be far from adequate in contemporary society with its large investment in human capital. Would that economics could have been blessed by the marriage of Irving Fisher's allinclusive concept of capital [4] and John R. Commons' legal foundations of that capital [3]. It is currently a mark of sophistication in presenting economic models not to mention institutions. But for all that, it is a significant trait of contemporary economics that, despite this omission, it manages somehow to find support for institutional changes. It is a neat trick, but it cannot hide the fact that, in thinking about institutions, the analytical cupboard is bare. There are a few old boxes on the back shelf labeled "institutional economics" which have been pushed aside and which have long been

Factor Proportions, Human Capital and Foreign Trade: The Case of West Germany Reconsidered

Abstract: Introduction, 152. — Method of analysis, 153. — Determination of returns to human capital, 156. — Results of the study, 158. — Conclusion, 160.

PRINClPLES IN THE VALUATION OF HUMAN CAPITAL

Abstract: Human capital concepts and measures have been applied and misapplied to an increasing variety of economic problem areas, two of which are examined. One of these is measurement of human capital gains and losses through migration. First requirements here are specification of the gaining or losing entities and of the relevant welfare functions. Alternatives in these respects are outlined. It is then argued that an appropriately adapted Fisherian present-value assessment of human capital is normally the correct measure. Replacement costs are a legitimate substitute only for young migrants with little cumulated learning through experience and even then they have usually been fallaciously applied. Probability adjustments for migration and re-migration are required in both cost and present-value assessments of human capital effects of migration-relevant policy alternatives, but the nature of those adjustments differs with the measurement approach used. For longitudinal analysis of contributions of human capital to economic growth, all measures of human capital stocks are inappropriate. A first principle of such analysis is measurement of resource inputs as flows. A coordinate principle requires that disaggregation be carried as far as necessary to distinguish essentially homogeneous categories of labor inputs. Though a way of separating out the schooling versus on-the-job-experience components of human capital is illustrated, it requires some strong assumptions. Splitting men into abstracted human capital components is better avoided in growth analysis. Furthermore, categorization of labor-force sub-groups could equally well provide the basis for rate-of-return assessments of marginal changes in the pace of investments in humans. Such assessments would incorporate the main elements of capital theory except valuation of the capital asset itself. Ultimately, human resource measurements for use in major public policy decisions relating to either growth or migration (or both) must incorporate modifications or error components that allow for development phenomena that elude marginal assessments. Among developing countries especially, a consideration of educational diffusion processes and dynamic productivity scale effects, for example, could have critical measurement and policy implications.

Economics of Human Resources: A Bibliography.

Abstract: EDRS Price MF-S0.65 HC-S3.29 *Bibliographies, *Cost Effectiveness, Economic Progress, *Human Capital, *Human Resources, Labor Economics, *Manpower Development, Productivity, Technological Advancement Without attempting to be comprehensive, this bibliography lists over 150 government documents, private publications, and journal articles on manpower and human resources, selected as representative works in the interdisciplinary field of human resources. Areas covered include: (1) general works, (2) investment in human capital, (3) cost-effectiveness of education, (4) economic growth, (5) manpower implications of education, (6) manpower programs and policies, (7) social welfare programs, (8) labor theory, and (9) technological change. (BH)

Human Resource Development for Economic Growth

Abstract: Human resource development may be identified as the process through which a society augments the skills, education, and productive abilities of its people. In essence, it means increases in human capital. Human capital is accumulated and improved upon in several ways: through programs of education and formal training, training on the job, and through individual initiative. It is generally agreed that this process, if carefully designed and implemented, promotes economic growth in any country.

Marshall on Human Capital: Comment

Abstract: In a recent article in this Journal, Richard Blandy asserted that my comment, "Although this essay is not exhaustive, it will be shown, in essence, that the concept of human capital was somewhat prominent in economic thinking until Marshall discarded the notion as 'unrealistic"' (Kiker, 1966, p. 481), implied that Marshall failed to consider improvements in the quality of human beings within the capital analytical framework (Blandy, 1967, p. 874). Such a view, according to Blandy, "is a misconception," since "he [Marshall] used the notion extensively in the Principles to analyze the economic causes and effects of changes in the quality of human beings" (Blandy, 1967, p. 874). In partial support of this assertion, Blandy quoted passages from earlier editions of the Principles in which Marshall defined what is now called human capital as "personal capital." These passages were deleted from later editions, owing to what Blandy called Marshall's fallibility as an author to perceive the full logic of his revisions (Blandy, 1967, p. 874). One might speculate, however, that Marshall changed his mind about the usefulness of treating human investments that become an integral part of man within the capital definitional scheme. I concur with Blandy that Marshall was interested in improvements in the quality of human beings; on occasion he treated such improvements as capital investments. I suggested this in the article to which Blandy referred: "Alfred Marshall admitted that an estimate of the capital value of a man might be useful and discussed clearly the capitalized-net-earnings approach to human-capital evaluation" (Kiker, 1966, p. 487). In fact, Marshall suggested that "the most valuable of all capital is that invested in human beings" (1959, p. 469). In evaluating this human capital, Marshall advocated taking-although he never did so-the family and not the individual as his unit of measurement. "At all events," he said, "we cannot treat the cost of production of efficient men as an isolated problem" (Marshall, 1959, p. 469). It must be

Education and economic development-the canadian case*

Abstract: This study assesses the relationship of education and economic growth, economic development and economic progress in aggregate, in structural and in micro-economic terms on the basis of one hundred years of Canadian experience. Education is considered as a factor of input. The contribution made by knowledge resulting from additional education expands the capacity to produce, and increases the demand for goods and services and the desire for greater leisure. The dual function of education is stressed: the demand and supply effect. Education is examined both as a cause and a consequence of economic growth, economic development and economic progress, through its contribution to the quality of the labour force, earning capacity, both individual and national, productivity, the rate of economic growth and the character of economic development. The Canadian experience suggests that educational progress generally occurred in line with economic development during the first eight decades, with the real take-off in educational advancement only occurring in the last two decades, when the nation reached the stage of technological maturity and high mass-consumption. Among the reasons for the lower ratio of gross national product devoted to education in the first eight decades were the low priority attached to education, the emphasis on investment in physical capital because of its shorter pay-off period than investment in human capital, and the heavy reliance on a substantial flow of immigrants who had obtained their education and training abroad. A distinct change occurred, however, in the last two decades, partly as a result of new technological challenges and partly as the result of changes in private and public attitudes, as the recognition of the rewards of education in terms of individual advancement and social progress led to a greater willingness to devote an increasing proportion of the nation's resources to investment in human capital, long pay-off periods notwithstanding.

Some Questions for Economists and Society About Adult Education

Abstract: give this paper that it should not be directed to education in general but limited to adult, extension, or continuing education. For purposes of this paper, adult education, which is the label that will be used consistently, includes activities which are deliberately planned and undertaken with the intent of changing the knowledge, skills, and/or attitudes of participating adults (those past high school age) who are not regularly matriculated in colleges. The words "deliberately planned and undertaken" are emphasized because a person can learn from almost every conversation or experience;' but these accidental educational experiences cannot be identified and costs and benefits determined. Included are only those activities where education is intended by sponsor and participant. Advertising and political speeches are excluded although both often do result in education as defined above. This is a large and the most rapidly growing segment of education. The federal government will spend over three billion dollars this year for educating adults of the country and probably another billion for educating its own personnel. State and local governments, schools, colleges, and universities will invest over a billion dollars in adult education. Atlhough hard estimates of expenditures of the private sector are difficult to get, it has been indicated that private industry spends 15 to 17 billion dollars annually for adult education.2 If income foregone as a result of participation in the educational activities is included, the expenditures are staggering in magnitude. These estimates are given to provide a rough idea of the present size of the subject under discussion. The vagueness of the estimates is a warning of difficulties encountered in developing this paper. Though still meager, there is a growing interest in model building and empirical research on the economics of education. The best summary of the current status of this research is given by T. W. Schultz [10]. Additional research is substantiating his original thesis that education builds human capital and that this accounts for a major part of the unexplained growth of society. These studies are leading to an all-inclusive concept of 'Haggstrom argues that many adults with relatively little formal education can be given further education only through a social action movement and most learning of adults occurs through self-instruction [5]. There is ample evidence to dispute this theory but learning through experience does occur.