Investing in human capital leads to human development, as it improves a person’s experience, knowledge, health, and morale. This enables individuals to create a better life and contribute to society, with examples including scientists developing vaccines and individuals using their knowledge in community development.
The relationship between human capital and human development is the fact that any investment in human capital has the effect of leading to human development. In other words, human capital is an enabler of human development. Human capital refers to all those factors capable of leading to an improvement in a person’s experience, knowledge, health and morale. This human capital can be deposited through informal and formal means of training and educating people, as well as through different means of health care, aimed at maintaining good health.
Human capital and human development are linked by how human capital increases enable an individual to create a better life. For example, someone trained to be an engineer has been deposited in human capital that he can use to earn a living. By using the skills learned and honed as part of the human capital improvement process, this person will create conditions that will further facilitate development through the ability to earn money and live an independent and comfortable life. People who undergo additional on-the-job training as part of their investment in human capital will also be able to increase their earning potentials. While these benefits are individual, human capital and human development are also linked more generally.
Someone who has a wealth of human capital can use this repertoire of knowledge, not just for their own human development, but for the development of the community and even the world at large. Examples are highly trained scientists who use their knowledge, experience and training to develop vaccines and cures for various forms of disease. This is a direct link between human capital and human development, because this medicine can help in the prevention and treatment of different types of diseases.
In the same vein, people with heavy investment in human capital can also use knowledge in community development in areas such as economics, engineering, arts and law. All of these contributions to society help move forward and are the result of the inflow of human capital into individuals. Furthermore, the instillation of good morals in individuals shows a link between human capital and human development, because this investment helps in reducing criminal tendencies and preventing the degradation of society.
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