Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education

Posted: 4 Nov 2009

See all articles by Gary S. Becker

Gary S. Becker

University of Chicago - Department of Economics; University of Chicago - Booth School of Business

Date Written: 1964

Abstract

A diverse array of factors may influence both earnings and consumption; however, this work primarily focuses on the impact of investments in human capital upon an individual's potential earnings and psychic income. For this study, investments in human capital include such factors as educational level, on-the-job skills training, health care, migration, and consideration of issues regarding regional prices and income. Taking into account varying cultures and political regimes, the research indicates that economic earnings tend to be positively correlated to education and skill level. Additionally, studies indicate an inverse correlation between education and unemployment. Presents a theoretical overview of the types of human capital and the impact of investment in human capital on earnings and rates of return. Then utilizes empirical data and research to analyze the theoretical issues related to investment in human capital, specifically formal education. Considered are such issues as costs and returns of investments, and social and private gains of individuals. The research compares and contrasts these factors based upon both education and skill level. Areas of future research are identified, including further analysis of issues regarding social gains and differing levels of success across different regions and countries. (AKP)

Keywords: Employee training, Earnings, Technological change, Skills, Rates of return, Economic development, Educational background, Human capital

Suggested Citation

Becker, Gary S., Human Capital: A Theoretical and Empirical Analysis, with Special Reference to Education (1964). University of Illinois at Urbana-Champaign's Academy for Entrepreneurial Leadership Historical Research Reference in Entrepreneurship. Available at SSRN: https://ssrn.com/abstract=1496221

Gary S. Becker (Contact Author)

University of Chicago - Department of Economics ( email )

1126 East 59th Street
Chicago, IL 60637
United States

University of Chicago - Booth School of Business

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States

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