Human Capital

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Definition of 'Human Capital'

Human capital is the knowledge, skills, experience, and other attributes embodied in individuals that are relevant to their work. It is an intangible asset that can be used to create economic value. Human capital is often contrasted with physical capital, which is the tangible assets used in production, such as machinery and equipment.

Human capital is important because it is a key factor in economic growth. A country with a well-educated and skilled workforce is more likely to be prosperous than a country with a less educated and skilled workforce. Human capital can also help businesses to be more productive and innovative.

There are a number of ways to invest in human capital. One way is to provide education and training to workers. Another way is to create a work environment that encourages learning and innovation. Governments can also invest in human capital by providing financial support for education and training.

The value of human capital is often difficult to measure. However, there are a number of ways to estimate the value of human capital. One way is to look at the wages that workers earn. Another way is to look at the productivity of workers.

Human capital is a valuable asset that can help businesses and countries to grow and prosper. By investing in human capital, businesses and governments can improve their productivity and competitiveness.

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