Final answer:
Human capital refers to the skills and knowledge possessed by individuals. It plays a vital role in economic development by enhancing productivity and innovation.
Step-by-step explanation:
Human capital refers to the skills and knowledge possessed by individuals. It includes their education, training, and health. Human capital plays a crucial role in economic development by enhancing productivity and innovation. For example, a well-educated and skilled workforce contributes to higher economic growth rates.
Public investment in human capital is often carried out by governments through the education system. This investment can lead to a more educated and skilled workforce, which in turn contributes to higher rates of economic growth. Additional investment in human capital is particularly important for low-income nations seeking to increase productivity and growth.
Increasing human capital can be accomplished through various means, such as improving education and promoting apprenticeships. By upgrading the health, skills, and knowledge of the workforce, human capital is enhanced, leading to economic benefits.