human capital theory
HYOO-mun KAP-ih-tul THEE-oh-ree
ˈhjuːmən ˈkæpɪtəl ˈθiːəriListen
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Dictionary meaning
the economic framework developed by Gary Becker, Theodore Schultz, and Jacob Mincer in the 1960s that treats education, training, health, and other investments in individual knowledge and capabilities as a form of capital accumulation that raises future productivity and earnings, analogous to physical capital investment in machinery and infrastructure; human capital theory predicts that rational individuals will invest in education and training up to the point where the discounted future wage premium equals the direct and opportunity costs of the investment, and it has been enormously influential in education policy, development economics, and labour economics, though critics argue it obscures the social and political determinants of educational access and labour market outcomes
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