Final answer:
In economics, human resources refer to the supply and development of human effort for producing goods and services. Labor contributes as part of the inputs, while human capital indicates the quality through the skills and education of workers.
Step-by-step explanation:
Human resources, as defined in economics, is the supply and development of human effort directed towards producing goods and services. Labor refers to the human effort that can be applied to the production of goods and services, which includes both employed individuals and those who are actively seeking employment. The Industrial Revolution was a period marked by the introduction of power-driven machinery, elevating the importance of human resources in the production process.
The concept of human capital pertains to the accumulated skills and education of workers, and it influences their efficiency and productivity. Caroline Krafft notes that investments in human capital, such as education and health, enable workers to be more productive, thus translating their time effectively into production, which in turn may lead to higher wages and economic output.
In any economy, inputs - or factors of production - are essential for creating goods and services. These inputs include labor, materials, and machinery. The quality and quantity of labor, or human resources, significantly impact the ability of an economy to produce and prosper.