REPLY ON: Schultz, The Economic Importance of Human Capital in Modernization

COURSE: WORK AND LEARNING

FORUM: Current development and discourses on work and learning

TOPICS: P. BROWN, SKILL FORMATION, HUMAN CAPITAL

REPLY TO ANNIKA’s POST (link to Itslearning)

Hi Annika,

Here are some comments based on the readings and my own experience. I believe the questions you raised could easily apply to western countries, unless we accept Human Capital Theory ipso facto without considering the harsh reality of many of us living in so called rich economies. The readings we are discussing now date back to 1993 (Schultz) and 2001 (Brown) and therefore do not include considerations of the recent economic crisis that has brought up many questions with regard to the universal validity of what Brown defines as a linear model based on an automatic progression that links technological change, to education and training, high skills and eventually high wages. (Brown, p.12). In this article, Schultz does not question such progressive development and sees it as the central tenet of a healthy economy that would produce increasingly higher wages as a result of sound human capital investments. So, back to your question, I would tend to think that Human Capital Theory remains a theory. I believe that a broader approach to understanding these issues, one that would include the study of the many interacting factors and stakeholders in a specific context, would relieve you from considering Beatrice’s question as a zero-sum decision, and provide you with useful insights into the nature of these issues.