Integrating Human Capital Concepts in Productivity and Growth Topics
Knowledge management and intellectual capital have become the mantra of cutting edge business topics; however, the building block of human capital has never been fully integrated into a knowledge based approach to productivity – specifically, how to develop human capital or analyze it. During the course of this paper, a careful framework detailing the relationship between formal education, informal education, acculturation, earnings and economic growth has been developed. A review of economic, education, and educational psychology literature develops the linkages between education and productivity, productivity and earnings growth, and ultimately education and economic growth. The central argument embraces applying human capital concepts in integrated business applications in a fashion that captures how human capital is developed, harnessed, and translated into productivity. Epistemologically, the paper argues that economists must develop firm microeconomic underpinnings to human capital theory beyond wage-earnings arguments to fully develop the economic growth – education relationship.