general human capital

economics

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July 16, 2026

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Human capital refers to the economic value of a person's skills, knowledge, and qualifications. This concept, popularized by economist Theodore Schultz, views education not as an expense but as an investment that enhances an individual's economic worth and boosts a country's overall productivity and competitiveness.12

Investments in human capital, such as formal education, yield returns that can exceed traditional investments in technology or physical capital. Wealthier families can facilitate this by subsidizing their children's education, leading to higher earning potential. General human capital, acquired through formal education, is valued by all employers, while firm-specific skills are gained through on-the-job training.13

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wage and salary
Human-capital theory
…introduced the important distinction between “general” human capital (which is valued by all potential employers) and “firm-specific” human capital (which involves skills and knowledge that have productive value in only one particular company). Formal education produces general human capital, while on-the-job training usually produces both types. To understand investments in…
Read More
…introduced the important distinction between “general” human capital (which is valued by all potential employers) and “firm-specific” human capital (which involves skills and knowledge that have productive value in only one particular company). Formal education produces general human capital, while on-the-job training usually produces both types. To understand investments in…
Read More