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Human Capital, Manpower and Human Resources
As has already been noted earlier, the term human capital became popular after it was used by Theodore Schultz in the title itself of his Presidential Address to the American Economic Association. Schultz identified five sources/five forms of human capital which have already been noted. Classical economic theory recognised only two factors of production that best explained agricultural economies – Land and Labour.
With the growth of industrialisation in Europe and England, a third factor came to be recognised and that was capital in the form of machinery and equipments. Land, machinery and equipments were together treated as physical capital. With the popularity of ‘money’ as a medium of exchange in trade and services, a development over the barter system, David Ricardo distinguished between fixed capital like land or machinery from money which he referred to as ‘circulating capital’.
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