The Human Capital Theory

The Human Capital Theory suggests that investments in education, training, and skills improve a person's productivity, leading to better job opportunities and higher earnings. Essentially, just as investing in tools or machinery can increase a company's output, investing in individuals’ knowledge and abilities enhances their value in the workforce. This theory views education and experience as valuable assets that contribute to an individual's economic success and overall economic growth. It emphasizes the idea that skilled, well-educated workers are more efficient, innovative, and capable of generating higher incomes.