Concept of Human Resources

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Concept of Human Resources

Human resource refers to the population of a country and its education, skill, foresight and productivity. We cannot estimate the human power of a country only on the basis of its population, for this the properties of population have to be considered. According to Harbison and Myers, “The development of human resources is a process of increasing the knowledge, skill and efficiency of the individuals of the society. can be brought as

Meaning human capital formation or human development is a process under which a large amount of investment is made for the development of manpower so that the country’s manpower can acquire technical knowledge, ability and skill. Pro . According to Harbinson, human capital formation means providing and increasing the number of persons who are skilled, educated and experienced, who are absolutely needed for the economic and political development of the country. Human capital formation is thus related to planning in man and his creative means of production. “The term human capital is used both in aggregate and in the broad sense. In the narrow sense, investment in human capital means expenditure on education and training. Whereas in the broad sense, expenditure on health, education and all social services means expenditure. In simple words, any investment made in human capital which enhances the education, training, health and standard of living of manpower, will be considered as an active investment of human capital formation.

Elements of Human Resource Development

Pro . Schultz has mentioned the following four methods for the development of human resources:

( i ) such planned health facilities which include all expenditures which affect the life expectancy and strength and vitality of the people .
(ii) On-the-job training, consisting of old-fashioned apprenticeships organized by firms.
(iii) formally organized education at the elementary, secondary and higher levels
(iv) study programs for adults who do not organize farms, especially extension programs on agriculture.


Importance of human capital formation in economic development

The idea of ​​investment in human capital has evolved recently. It is practical to give importance to accumulation of physical capital in the process of economic development. It is now increasingly recognized that the growth of capital stock in practice depends to a large extent on human capital formation, which is the process of increasing the knowledge, skills and capabilities of all the people of the country.

“The studies of Schulz, Harbinson, Moses Abramowitz, Bakker, Denison, Kendrick Marie Bowman Kuznets and a team of other economists show that one of the most important factors responsible for the American economy is the increasing relative expenditure on education. The importance of human capital is as follows: it will be clear from the points

In the process of economic development, human resources perform the following functions in the process of economic development.

(i) exploitation of natural resources
(II) raising capital,
(iii) to submit a demand for the goods and
(iv) Promotion of trading system.

To accelerate the pace of economic development, the country needs trained teachers, doctors, engineers, economists, managers, artists, writers, craftsmen etc. All these are part of human capital itself.

Increase in Productivity and Efficiency In order to increase the productivity and efficiency of the residents of the country, it is necessary that their education, training and health etc. should be invested so that the quality of human resources can be improved. In fact, the quality of human resources can be improved. In fact, the structure of economic development can be built only on the efficiency and efficiency of human resources.

Gainful employment Underdeveloped countries face problems with manpower. They lack the critical skills required for the industrial sector and have an overabundance of labor force. The availability of surplus labor force is largely due to lack of critical skills. So those separate problems are related to each other. The goal of human capital formation is to create the necessary skills in human beings as productive means and to solve these problems by providing them gainful employment.

Change in the attitude of labor force Social behavior of labor force is also important in the process of economic development. Because unless there is a change in the attitude of the labor force, the process of economic development cannot start. It is said that this bulldozer can clear the forest but cannot destroy the differences and frustrations associated with the traditional ideas of human power. Education and training are necessary for this, so the process of change in traditional society requires huge amounts of vital human capital. Pro . Ajit Das comes to the conclusion of Gupta that “the resources allocated to education are helpful in increasing the productive capacity, hence increasing production and consumption in the future. Therefore education or any other type of social infrastructure is an essential part of investment theory”.


base of industrialization

To lay the foundation of industrialization in underdeveloped countries also requires investment in human capital formation as shown by Prof. Golabendh has aimed, “Now we get more of our industrial growth not in investment of capital but by investment in human beings and reforms brought about by sophisticated human beings.” It is clear from the above discussion that in today’s era the investment in human capital. Or investment in human has become a major condition and pre-requisite of economic development, unless there is a full development of the available labor force in an underdeveloped country, then economic development will remain. ,


Contribution of human resource or population in economic development

Human resources play an important role in the economic development of a country. Although the amount of natural resources and capital has a special important role in economic development, yet it is a non-living means of economic development, in fact, man is the only power that makes these resources efficient and makes efficient use of them by moving them in the desired direction by intellectual ability. Some scholars believe that human resources are more important than natural resources for economic development.

The views of the following scholars in this regard are notable, according to Harbinson and Myers, “The formation of modern nations depends on the development of human beings and the organization of human activities. No doubt, capital, natural resources, foreign aid and international trade play their role in economic development, but None of these is as important as human power.

“The building of moderm nations depends upon the development of people and the organization of human activity Capital , natural resources , foreign ald the International trade of course play importatant role in economic growth but none is more important than man power -Harbinson and Myres Education. Manpower and Economic Growth

According to Prof. Whipple, the real wealth of a nation lies not in its land, water, forests, food, animals and birds or dollars, but in that nation’s rich and happy men, women and children. “Results According to Prof. Richard T. Gill (RT. Gill), economic development is not a mechanical process, it is a human undertaking and like all other human undertakings whose ability depends on the qualities and attitudes of those individuals who make it their own. In this way, human resource is more important than other resources of economic development.

Today, the discovery of new resources for economic development, the construction of skyscrapers and “giant factories”, the efficient piercing of the mountain, the dams controlling the water of the ocean and space Vijay Bangwati rivers, the mineral wealth emanating from the womb of the earth, etc. are all human efforts and Clarity is the gift of will power, population is helpful in making economic development dynamic.

Population growth initially has a favorable effect on economic development. This increases the labor force, due to which the natural resource is properly exploited, the total production and per capita income of the country increases. And the population of the country’s economic development is helpful in economic development. Prominent among those who express this view is the growth in economic growth F. Penrose is a precondition etc.
The looks of Prof 0 Harshman go to K. Henson , Arthur Lewis , Colin Clark and E . According to, “by population,” the pressure of population encourages economic development. “Population is helpful in the prosperity of a country, but there is another aspect of this picture. If population is an effective source of economic development, then in some cases it is also an obstacle in the path of economic development.

When the population is to grow at a rapid pace, then the economy moves away from the ideal proportion of economic development, due to which new problems arise in the country and the former small problems become bigger and more complex, in this way the population becomes a factor in economic development. The scene becomes a hindrance element. According to Richard Gill,
“The ultimate effect of population growth on output and per capita income will be positive, negative or neutral, depending on whether the population is increasing rapidly. Instead the number of consumers in the country will be high and overall per capita output will have a negative impact.

Conversely, if the age composition of the number is favourable, it will have a positive effect on economic development. Again, the effect of population growth on economic development also depends on what is the technology level, stage of development, rate of capital formation, nature of manpower, motivation for innovation and market nature in the country. The rapidly increasing population stands as a formidable obstacle in the way of economic development. According to National Prof. Singer, population growth has a negative impact on economic development, reducing the rate of savings and reducing the productivity of investment.

Prof. Singer expresses the view that economic development can take place only when the rate of productivity and population growth is more than the rate of population growth. He saved the rate of economic growth

To express the relationship between the rate of investment, productivity and the rate of population growth, the following equation is introduced D – S. Pr In the above equation, D times economic growth S = P = rate of net savings (or savings income ratio)


The field of human resource formation is often interpreted to mean spending on education, training, health, proper food and proper housing, etc., in human resources. But Prof. Tea . W. Schulz is of the opinion that in theory it is considered more necessary to spend/appropriate for skill building or for improving human capabilities, mainly on the following items:

Education & Training Facilities

Pro . Richard T. According to Gill, the investment made on education will be considered as the most meaningful investment from the point of view of economic development “Similar views have also been put by Prof. Jan Kenneth Galbraith. In his view, education is both consumption and investment. Education and training are also a type of investment like investment. American economists consider that the annual rate of return on investment in education in their country is about 10 percent.

According to John Kenneth Galbraith, “The study done by Theodore Schultz, among others in the United States, has made it clear that expenditure on education can greatly increase production. By this he has shown that a dollar or a rupee lost to human beings is often more than in the intellectual improvement of national income than what he hated the most by putting a dollar or rupee in the capital goods of the railways. The growth is visible in dams, machine parts or other clearly visible.

When education is viewed as such, it becomes a kind of highly productive investment. To what extent should education be spent? In this regard there is the view of Stoneyer and Hague. “From the national point of view, the expenditure on education, whether it be on the school or the college or the university, should be increased so long as the return on it is equal to the return received from people elsewhere in the economy. Don’t be equal.

“Considering education from a purely economic point of view, we come to the conclusion that educational programs should be based on the basis on which industrial plans are made. A reasonable calculation of costs and benefits in relation to investment in education should be made. This is a definite productive investment.

Countries like Germany and Japan, which were ruined by war in the Second World War, have been almost rebuilt in a period of 5 or 10 years. There the process of physical reconstruction has increased at an astonishing speed. But if the accumulated knowledge and ingenuity of the German and Japanese people were somehow destroyed, the process of reconstruction would undoubtedly have taken many centuries. In the context of India, Dr. Rao wrote,

“Today our country is facing a crisis of character and we can only combat it by giving such education, which is used in the direction of building humanity and character. Undoubtedly, it is the duty of education to fulfill the conditions of economy in our universities. And the attitudes and research work should be supported, which are needed to meet the needs of our well-planned economy and to accelerate economic growth.

Therefore, planning for today’s educationists, teachers, parents and youth all need to be aware of the latest approach to education. Only then will social and economic development take place in a smooth and coordinated manner. Thus the importance of education cannot be forgotten.

Health, nutrition and housing system For human capital formation, it is necessary that proper investment should be made for the expansion of health services, availability of nutritious food and proper housing. Therefore, expenditure on education, training, health services, nutrition and housing comes in the areas of human capital formation. Due to the availability of health facilities, balanced food and proper housing to the individuals, their expected lifespan and their efficiency increase. Increasing average age has a very beneficial effect on the economy as is evident from the following description:

(i) With an increase in the average age, the life of a person increases, in which he can increase more in the national production age. For example in India the expected age is 58 years and in America it is 78 years.

Due to the low average age, the expenditure incurred on the upbringing, education and training of the citizens does not get full return. Most of the citizens die before the age of 60. Therefore, in order to take full advantage of the wealth imposed on human beings, it is necessary that the life span should increase.

(iii) A large part of the national income is spent on such infants, who become victims of death before reaching productive age. Therefore, the low average age indicates the futility of the effort and investment made for the upbringing of the children. Pro . According to Alfred Bonne, ”

In economically underdeveloped countries, these innumerable youths are involved in physical and non-physical factors in the maintenance and educational development.

There is a loss of both types of investment, which does not reach the mature stage of its life. Even though there is less per capita investment in education, clothing and food items as compared to western countries, but still the loss of total expenditure is huge. A livelihood earner easily pays the cost of his maintenance, training etc. to the society in western countries, as he has opportunities to reach the productive years of his life and hence he contributes for 40 or more years. ,

(iv) There is a shortage of experienced people in the country due to the low average age. For example . In India, the proportion of working experience veterans, above 55, was only 10 percent in 2001 due to the short average life span, while in the US the same ratio is 18.0 percent.


Cause of low level of human capital in underdeveloped countries

In underdeveloped countries like India, the level of human capital is low. Following are the main reasons for this

, 1. Shortage of Foreign Exchange Funds There is a shortage of foreign exchange funds in underdeveloped countries. As a result, these countries are unable to import foreign goods and without the knowledge of foreign technology, they cannot rise to their level.

2. Human capital formation is a continuous long process: Human capital formation is a continuous long process, as its pleasant results are also obtained in the long run. Underdeveloped countries lack resources. Therefore, they pay more attention to material development which is quick and also situational, as a result the level of human capital formation remains low.

3. Conservatism: Conservative ideas prevailing in underdeveloped countries prove to be a hindrance in the adoption and application of technical knowledge. As a result, the level of human capital formation remains low.

4. Lack of will power: Conservative ideas prevailing in underdeveloped countries prove to be inhibited in adopting and applying technical knowledge. As a result, the level of human capital formation remains low.

5. Agricultural economy The economy of underdeveloped countries is agricultural and the possibilities of innovation and use of technology in agriculture are relatively limited.

6. Lack of planning of human resources In the absence of proper planning of human resources, unemployment is increasing in the country. No particular balance can be established between the demand and supply of human resources. As a result of this, on the one hand the labor force is getting destroyed and on the other hand the contribution of labor in production is decreasing.

7. Regional Disparities: The services provided to improve Jeevan Pramaan are unevenly distributed in different regions of the country. These disparities are especially visible in rural and urban areas. Various services of education, health etc. are available in urban areas only. There is a severe shortage of them in rural areas.

8. Low Productivity: Investments made to improve the quality of life do not yield immediate income, but such benefits cannot be directly measured. Therefore, such investment is considered as unproductive investment and the private entrepreneur is not motivated to invest in this sector.

9 Private Sector Indifference: Investing in human resources pays off after a long time. That is why the private sector does not take any interest in its development. The entire burden of this has to be handled by the government itself. The resources of the government are limited. Therefore, due attention is not paid to the development of human resources.

10. Growth in Population The growth of population in India is happening at a very fast pace and the population is already more than that. A lot of resources are needed for the development of such a large population. It is not possible to arrange so many resources for a poor country like India.



Criteria for human resource formation or education

The arrival of productivity of investment in human capital formation, and in particular education, is a very complex problem. Economists have presented the following criteria or criteria for this

The criterion of rate of return in the form of investment has two parts of education, first, future consumption share, second, future earning share. Investment in skills and knowledge increases future incomes or earnings, whereas the satisfaction derived from education is the consumption part. Since education as a use share, the return included in the sum of the national income should be taken into account only in the future earnings share, however, one method for this appropriation in education is that the average number of educated people engaged in similar paths The life-time earnings of urban men are compared with the average life-time earnings of people with less education.

For example , Bakker calculated that the rate of return on investment to college education in the United States for a white was 125 percent in 1940 and 10 percent in 1950 . But after deducting taxes, it was 9 percent in 1940 and 1950. This calculation included the direct cost to the student, the earnings spent during the study period and the share of the cost of the college. Limitations The following limitations and difficulties of this criterion

(i) External Economics Under this method, only direct material monetary benefits are measured, while external economies of education such as the direct and indirect benefits received by the country as a result of improvement in the level of education are not calculated.

(ii) in personal qualities The earning power of a person is affected not only by the degree of his education but also by his work training ability, experience, family ties.

(iii) Collective effort This criterion is not able to correctly calculate the collective efforts of the law classes.

(iv) Due to the appropriation made for skill building of the economy, productive capacity, not only does the income of the persons concerned increase, but it also increases the total production capacity of the work system, which has not been taken into account in this parameter.

(v) Nature of education: It has not been clarified in the criteria that how much and how education is required for economic development.


Criterion of contribution of education to Gross National Income

According to this criterion, the amount of increase in the gross national income in a given period is calculated by investing in education. Pro . Sakar Polus uses the following formula to know the competency of education:

(1) Social rate of return wasting (constant annual earnings variation) Two years Opportunity cost Recurrent cost Annual capital cost 21 percent 50% Prof. Schultz analyzed the contribution of education to the growth of America’s national income in the period from 11000 to 1956, and concluded that the allocation of resources to education is in relation to consumer income in dollars and the relativity of aggregate formation of physical capital in dollars. increased by 3.5 times.

In other words, investment in education contributed 3.5 times more than investment in physical capital. In India this criterion was used by Prof. It has been done by Panchmukhi from the point of view of cost-benefit analysis in education. Properties:

(i) Estimates of this parameter are more realistic than estimates of returns on education, as they also measure the impact of educational investment on the economy.

(ii) This estimate is based on the opportunity cost of education, that is, it can take into account both income lost during schooling, ie student life, and expenditure on education. Demerits:

(i) This criterion is related to the biggest problem of abandoned income, it is difficult to calculate than to calculate the abandoned income. Because

(a) Severe unemployment is found in underdeveloped countries. In such a situation, the calculation of foregone earnings would be arbitrary or voluntary because the increasing supply of labor reduces the real income.

(b) Most of the youth in underdeveloped countries do not get school education. But they earn money in the family businesses. It is difficult to calculate the forsaken income of such youths. This criterion does not take into account the social costs of schooling. Due to the above difficulties, Belog has said, the assessments made regarding the profitability of education are not only technically and financially flawed, but also politically unethical.

residual instrument test

Kuznets, Kendrick, Grillicz, Jorgensen, Sozo and other economists have attempted to measure (a) the proportion of growth in Gross National Product (GNP) over a period of time by the contribution of measurable inputs of capital and labor. It is possible . and (b) what proportion of the increase in GNP can be contributed by other resources (which are kept in the residuals). Remaining resources are mainly education, research, training, scale saving and other factors affecting productivity. Denison estimated in this regard in America between 1929-57, according to which the contribution of education in the growth of total real national income was 23 percent. As far as the contribution of other residual means other than education was concerned, Dennis attributed it to the total increase of national income – 31 per cent, 20 per cent due to the accumulated effect of knowledge and 11 per cent due to Mane’s savings as a result of the growth rate of markets. was the reason. In contrast, Solow, in his study of the United States of America during the period 1909-49, considers the average growth rate of 90 percent per capita output to be the contribution of the residual factor, which falls under the general heading of technological change. Demerits Residual means deduction has the following drawbacks.

(i) Residual means is a very broad term in which education, research, training, scale, savings etc. have been included. As a result, this criterion is very complex.
(ii) This criterion makes no distinction between practical and practical education and the quality or content of education.

(iii) This criterion is based on the law of constant returns to scale. Whereas in a developing country increasing returns are found.

(iv) The residual criterion underestimates the contribution of capital to economic development. Because if the resources invested in the advancement of knowledge are counted under investment and such investment is included in the definition of capital stock, then a greater part of the rate of economic growth will be considered as the contribution of growth of capital stock and Due to increase in knowledge, skill, training etc., the remaining class will have less contribution.
(v) Jorgensen and Grillichij found in the study of America’s economy for the year 1945-65 that after correcting the errors of aggregation for capital, labour, prices, etc., virtually no residue remains.

Yes, the interpretation of which is required. After adjusting for these errors, the residual contribution comes down to 0.1 percent per annum.

composite index criterion

Harbison and Mayraj have developed a composite index criterion on the basis of indicators of certain values. The Composite Index is used by categorizing 75 countries and grouping them into four levels of research development as if they were research development. There are four groups: underdeveloped, partially developed, less advanced and advanced. After this, they have tried to study the relationship between these indicators and indicators of economic development. Harbison and Meirj have described human research developments in the following way:

(i) Number of first and second level teachers per 10,000 population

(ii) The number of doctors and dentists per 10,000 population.

(iii) Number of engineers and scientists per 10,000 population

(iv) The proportion of students admitted to the combined school of the adjusted first and second levels.

(v) Number of students admitted to the first (primary) level of education as a percentage of the estimated population in the age group of 5 to 14 years

(vi) The number of students admitted to the third (higher) level of education as a percentage of the estimated population in the age group of 20 to 24 years.

(vii) The number of students admitted to the second (secondary) level as a percentage of the estimated population in the age group of 15 to 19 years, adjusted for the school period.

(viii) Percentage of students admitted to the Faculties of Scientific and Technical Education in a current year

(ix) Percentage of students admitted in the Faculties of Humanities, Fine Arts and Law in the same year.

For statistical analysis they take these indicators of economic development .

(a) U. s . GDP per capita in dollars and

(b) active in agricultural activities
Percentage of population.

In addition he has used two more indicators:

(a) public expenditure on education as a percentage of the national income and
(b) Percentage of the total population from 5 to 14. The Harbison and Meirz study shows a close relationship between the enrollment ratio and GNP at all levels of education. is the highest correlation coefficient. You . s . The GNP per capita in dollars is found to be between the composite index of human resource development, which is the ratio of the number enrolled at the first level to the second.

Merits and Demerits The main features of this criterion are:

(a) This composite index is a useful criterion to measure the contribution of different levels of education for determining education policy related to economic development in underdeveloped countries.

(b) It expresses the degree of correlation between economic development indicators and human research development indicators. The main drawback of this criterion is that it expresses only quantitative relationships and ignores qualitative relationships. In addition, the composite index is also unable to reflect the effects of other factors such as abundant natural resources or population levels leading to higher GNP per capita, etc.


Human resource formation measures in underdeveloped countries

In underdeveloped countries, special attention has not been paid to human capital formation, due to which human capital is not of good quality even though human resources are high here. The following suggestions can be made for human capital formation. 24.8.1 Changes in the Education System Only by making fundamental reforms and changes in the education system can we encourage human capital formation in underdeveloped countries. On the one hand we should remove illiteracy by activating literacy programs in underdeveloped countries and higher education should be given only to those persons who are capable of it. The reason is that providing undergraduate and postgraduate education in colleges, colleges and universities does not lead to human capital formation. Rather they increase educated unemployment. There is a lot of dissatisfaction amongst the youth.

emphasis on technical education

Business, technical progress and training facilities are important determinants of economic development because technical progress and training facilities themselves are dependent on higher education and availability of trained manpower. Therefore, the emphasis on technical education in underdeveloped countries is because of the need for human capital in the form of educated persons in the professions. Underdeveloped countries are different because those individuals are complex methods and tools. For example, entrepreneurs, managers, administrators, scientists, engineers, doctors, etc. are needed. In fact, technical education should be made compulsory in most developed countries.

compulsory education :

Most of the population in underdeveloped countries is illiterate, so as far as possible, education up to school should be made compulsory for all the people in these countries. In most countries of Africa, South Africa and Asia, primary education has been given a lot of priority and primary education is free and compulsory. But secondary education is given less priority which is not suitable. Experience shows that secondary education provides only those regional skills which are essential for development. Emphasizing the importance of secondary education, Professor Lewis received secondary education.

Considers individuals as officers and non-commissioned officers of the economic and social system.

Adult education

A major obstacle in the successful implementation of economic development plans in underdeveloped countries is the illiteracy of adults. Therefore, due to illiteracy, they do not understand the importance of new schemes, as a result, they create a deadlock in their implementation. There is a complete lack of adult education programs in such countries, so there is a need to encourage adult education programs because adult education helps in changing the attitude of the farmers, enhances their decision-making skills and helps them in relation to modern agricultural practices. Provides necessary information. For maximum results, all programs of adult education should be linked to agricultural research centers and laboratories.

development of training

Along with education, training is also necessary for the formation of human capital because training not only increases the ability, skill and dexterity of a person but also gives them a broader outlook on life by increasing their self-reliance, respect and self-pride. . This is the reason that nowadays, almost all the expenditure on training and development program is considered as an investment, various types of programs are organized for the workers and managers in the developed institutions. Such as apprenticeship and refresher courses, re-training, salesman training program, management program, etc. Health is the basis of development. as well as that

expansion of health services

Human capital formation in underdeveloped countries. It is necessary that more investment should be made on health services because all round progress of human being and health are the parameters of efficiency and power of the people, for how long a person can remain engaged in the national progress engaged in construction work. The sick person cannot do anything. “Sickness can destroy a community by killing strong and strong people and increasing the number of those who do not work. In this way, not only does the number of workers decrease, but the power of labor also decreases.

The following suggestions can be given to increase the level of health in underdeveloped countries.

(i) Public health services and facilities should be developed and expanded.
(ii) Along with the advancement of medical science, medical facilities should also be rapidly expanded.
(iii) The government should try to eradicate poverty with determination, so that the income and standard of living of the people can be improved.
(iv) Adequate distribution of nutritious food grains should be done in the country by increasing them rapidly.
(v) Both the consumption and production of narcotic and harmful goods should be banned.
(vi) Arrangements should be made to include health education in the curriculum as a compulsory subject from primary level to higher level.
(vii) Health education, nutrition, obstetrics and dietetic education should be provided to women. At the same time, awareness should also be created in them about these subjects.

human capital policy formulation

An important step while formulating a policy regarding human capital is to find out how much return or return has been received as a result of investment on human capital and its various items. It is only after knowing this fact that by comparing the returns of human capital investment with the return or return of physical capital, a decision has to be taken as to how much should actually be spent on human capital.

Apart from this, out of the total amount invested in human capital, how much amount should be spent on various items, such as elementary, secondary and higher education, technical knowledge, medical education and health etc. But this estimation is practically quite complex in nature, which is because the benefits of human capital are not only visible and direct, but also invisible and indirect. Those are very difficult to guess.

Different ideologies have been presented by different scholars regarding investment on human capital, but David Owens’s ideology seems to be more relevant for less developed countries especially Indian conditions. In this regard, David Owens is of the opinion that

1 Expenditure on agriculture, medical and technical education, family planning etc. is reasonable from the point of view of return or return, but
2 Expenses on art education up to graduation level are not justified. As a result, it would be preferable to increase the expenditure of the first type more and reduce the expenditure of the second type.

Further enhancing his approach, Owens has also said that educated persons should be employed in areas where their services can contribute most to economic development. To follow this approach in the Indian context, it would be expedient to encourage educated people here to work in remote rural areas of the country. In

National Human Development Report Indicators

(1) Life expectancy at 1 year of age (ii) Infant Mortality rate by adding literacy rate to Enrollment and Achievement Ratio (III) Sum of age at 7 years and above Literacy rate (iv) Intensity of formal education (v) Rs.
In conclusion, it can be said that in reality the investments made on human capital will also have to be calculated like the returns obtained as a result of investment in physical capital and considering these returns as the basis, the human capital is calculated and the various investment items falling under it. priorities have to be set.

Only by doing this will it be possible to formulate a successful policy on human capital of any country, indices have been presented. These figures pertain to 1981, 1991 and 2001. Due to non-availability of data for all the states, the Human Development Indicators have been calculated for only 15 major states.

Even though the National Human Development Report uses roughly the same dimensions as those used in the UNDP’s Human Development Report, namely life-expectancy, educational achievement and economic achievement, it still includes the U.N. Slight changes have been made to the 0dp indicators.

Various indicators have been given importance for the calculation of Human Development Index compiled in the National Human Development Report. For example, life expectancy is assigned a weightage of 65 per cent for a health indicator while infant mortality is only 35 per cent. 65 percent weightage has been given and for this the enrollment in successive classes from class 1 to 12 has been made the basis.

Per capita consumption for the index of economic achievement has been adjusted against inflation, so that intra-state and intra-state comparisons can be made on per capita consumption basis. In the calculation of the National Human Development Index, as in the UNNDP methodology, equal importance has been given to these three indicators, namely, life expectancy, educational achievement and economic development. To calculate various indicators, the ratio criteria of the National Human Development Report have been prescribed.

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