Theoretical aspects of human capi tal and its role in economic process

Table Of Contents

Introduction ........................................................................... 3

Chapter I. Theoretical aspects of human capi tal and its role in economic   process .................................................... ... 5

1.1     Human capital and its place in the economic system ....... 5

1.2     Approaches to the formation of human capital ............... ... 8

1.3     The main methodology for assessing human capital ............... 10

Chapter II. And Investing in human capital ..... ............................. 15

2.1 Investment in human capital and their types ........................ 15

2.2 Performance indicators of investment in human capital ... 19

Chapter III. And businesses Investing in people capital ................................................. .................................................. . 24

3.1   Manpower   policy   and   s support height   human   capital   JSC   "Doug energy" .... .................................................................................................................... 24

3.2 Ivistitsii in human capital in JSC "Doug energy" ........... 8 February

Conclusion ................................................. ....................................... 30

List of References .................................... .. 31 

 

 

  

 

 

  

 

 

  

 

 

  

 

 

  

 

 

 

 

Introduction 

 

The concept of "human capital" becomes now of great importance not only for economists - theorists, but also for individual firms. Sharply increased interest in economics to human creative abilities, to the ways of their formation and development. Most companies begin to attach great importance to the accumulation of human capital as the most valuable of all types of capital. One way of accumulation of human capital is to invest in people and their health and education. Today the study of problems of efficiency of the productive forces people realized in the current conditions in the form of human capital is not only relevant, but extends to the category of priority in the structure of socio - economic research. This involves a deep research of the problem.

The main feature of Russia is that the majority of citizens live close to the level of biological survival. Most people can not afford to buy any books or going to the theater. Many are not able to spend money on maintaining their own health but forced spending on medication. The structure of investment in human capital is extremely heterogeneous and has individual character.

Scientists - demographers have long noted the rule that the life expectancy depends on the level of education and human intelligence. Citizens with higher education live longer than citizens without higher education. From this we can conclude that intelligence allows a person to form an effective structure of investments in human capital, that is, in himself.

Investment in human capital - an investment in the longevity and quality of life. At the age of thirty years, priority investments in human capital should be investing in quality education

The purpose of this course work: the show features investment in human capital.

The objective of this course work: review especially human capital, the importance of investment in human capital, as well as to show the importance of evaluating the effectiveness of human capital and investment in human capital.

In the first chapter of this course work is considered the essence of human capital, its types and characteristics, discusses the concept of investment in human capital and human capital evaluation methods

In the second chapter discusses the investment in human capital and their types efficiency of investment in human capital.

In the third chapter discusses the invest- ments in human capital of   "Doug energy." 

 

 

 

 

Head I. Theoretical aspects of human capital and its role in the economic process

1.1 Human Capital and its place in the economic system 

 

Human capital theory became engaged in the XIX   c. Then it became one of the most promising areas of development economics. From the second half of the twentieth century. it has become a major achievement especially the economics of education and labor.

In the economic literature, the concept of human capital in the broad and narrow sense. In a narrow sense, "one of the forms of capital is education. His human named because this form becomes part of human capital and is due to the fact that the future is a source of satisfaction or future earnings in, or a combination of both e . In broad terms, the human capital formed by investment (long-term investments) in person as the costs of education and training of the workforce at work, to health, migration and the search for information on prices and incomes.

In "Economic Encyclopedia" human capital is defined as "a special kind of investment, the total cost of the development of the reproductive capacity of the person to improve the quality and improve the functioning of the labor force. The composition of human capital facilities typically include knowledge of general education and special hara type crystal, skills, experience. "

For more complete and detailed characterization of human capital used functional approach. The principle of functional definition characterizes the phenomenon not only from the point of view of its internal structure, but from the point of view of its functional purpose, the final desired use.

Therefore, human capital - it is difficult set of skills, knowledge, abilities possessed by man. Firstly, it is the accumulated stock of skills, knowledge and abilities. Secondly, this is a stock of skills, knowledge, abilities, it is advisable that a person uses in a particular sphere of social reproduction and promotes the growth of labor productivity and production. Third, the judicious use of this stock in the form of high-activity naturally leads to an increase in earnings (income) of the employee. And, fourth, the increase in income stimulates interested in a person by investments that may relate to health, education, etc., Increase, build up a new supply of skills, knowledge and motivation to further his re-apply effectively.

Features of human capital:

-   in modern conditions human capital is the main value of the company and the main driver of economic growth;

-   human capital formation requires the person and society significant costs;

-   human capital in the form of skills and abilities is a certain stock, that can be cumulative;

-   human capital can wear out physically, economically and change its value depreciated;

-   human capital differs from physical capital in the degree of liquidity;

-   human capital can not be separated from its carrier - a living human being;

-   regardless of the sources of which may be public, family, private etc., the use of human capital and receiving direct income controlled by the man himself.

In the economic literature, there are several approaches to the classification of human capital. Types of human capital can be classified by cost components, investment in human capital. For example, there are the following of its components: the capital of education, health capital and the capital of culture.

From the point of view of the nature of the promotion of economic well-being of society distinguished consumption and productive human capital. Customer capital creates a flow of services consumed directly, and thus contributes to social utility. This can be a creative and educational activities. The result of such activity is expressed in providing consumers with such consumer services that lead to the emergence of new ways to meet the needs and improve the effectiveness of existing ways of addressing them Productive Capital creates a flow of services, which promotes the consumption of public utility. In this case, refers to the scientific and educational activities, which has direct practical application is in production (the creation of the means of production, technology, industrial products and services).

Another criterion classification of human capital is the difference between s forms in which it is embodied.

1. Living capital includes knowledge embodied in people.

2. lifeless capital is created when the knowledge embodied in the physical, material forms.

3. Institutional capital is composed of living and nonliving capital associated with the production of services that meet the collective needs of society. It includes all governmental and non-governmental institutions that promote the efficient use of the two types of capital.

 

1.2 P Waste in the formation of human capital 

 

Organizations are beginning to become increasingly important intangible characteristics of their employees, such as loyalty, the ability to establish relationships with customers and the willingness to take risks, as well as looking at ways of their formal assessment. And realizing how costly potential of such human qualities, the company converted them into something more concrete - human capital.

Modern stimulated investment in the modernization of the "quality" of workers as "intangible" assets, making them today the development of "intelligent, creative revolution" in production.

As an expression of "human capital" is included in the corporate lexicon, many companies are free to operate this concept, making no attempt to measure or manage the assets of which they speak. As a result, it is very difficult to establish a connection between the reflections of staff and financial results obtained by the company.

The current labor market experts have enormous freedom to choose their employers. The main reason why employees leave the company, is that of neither feel its demand of about or do not see prospects for the full development of their capabilities. Human Capital Management helps to effectively use the experience and knowledge of employees, to help them realize their full potential.

Proponents of the concept of human capital management are confident that by measuring the broad impact that staff have the financial performance of the organization, companies can choose, manage, evaluate and develop the capabilities of its employees so as to transform their human qualities in significant financial performance. While this approach involves finding ways to quantify what used to be considered intangible assets, specialists implementing these techniques, note that the market is analogous s business approaches are already in use. Grew so sharp share price of   "Doug energy" for example, reflects not only the company's financial condition, but also the potential that the sum of the knowledge, skills and ability to find new solutions in its employees.

Nevertheless, many executives refuse to investment in human capital development programs (such as, for example, training of personnel in the organization), as all are aware of the difficulties involved in determining the return on such investments. Many executives and analysts insist that human capital denies whatever dimension, and argue that the company actually devalue the value of employees when trying to approach to their assessment as to the measurement of financial assets.

Indeed, the measurement of human capital is usually inaccurate, but the process itself is extremely important measure. Accurate quantification of the impossible, and it is not particularly necessary. But organizations are realizing the important link between human capital and financial results of the company - communications, which are not able to take into account the traditional accounting methods.

Companies realize that the relationship can be shown, or may not appear in specific terms or figures that express the value of human capital. But trying to quantify it, they can understand what is the contribution to the work of each employee as they are committed to their work, what they think about the company and what is the probability that they are dismissed. Often in the process of assessing the human capital of the company to obtain useful understanding of their organizations and gain important information to work.

Gaining more and more supporters point of view that human capital - is the most valuable resource not only for individual companies, but also for society as a whole, much more important than natural resources or accumulated wealth. It is human capital, not plants, equipment and inventories are today indicator of competitiveness, economic growth and efficiency. 

 

1.3 The basic methodology for assessing human capital 

 

Human capital as a complex economic category has the qualitative and quantitative characteristics. As part of the modern theory of human capital is evaluated not only the volume of investments in human capital, but also the volume of accumulated individual human capital. When this count value of total human capital for one individual and for the whole country.

In the economic literature uses a wide variety of approaches and methods to assess human capital. In determining the level of human capital are used as cost (monetary) and natural evaluation.

One of the simplest ways is a method that uses natural (temporary) evaluation, measurement of human capital (ie education) in person-years of training. The more time spent on the education of the individual, the higher the education level, the greater the amount of human capital it possesses. This takes into account the varying length of the school year during the analyzed period, nonequivalence year students at different levels of education (eg secondary education in schools and higher education at the university).

A common method of measuring human capital is the principle of capitalization of future income based on the position of the so-called "preference benefits in time." The essence of the method: people tend to over estimate a sum of money or a set of benefits in the present time than the same amount, or a set of benefits in the future.

Each person can be considered as a combination of one unit of simple labor and a known amount of embodied human capital in it. Consequently, the salary received by any employee, can also be seen as a combination of the market price of its "flesh" and rental income from investments in this "flesh" human capital.

Human capital as a component of property generates income, which can be represented as discounted wages to workers for the entire period of working life. Income that an individual receives from the use of human capital as a weighted average annual earnings expected for the entire labor dosposobny period of life, there is a "permanent" (permanent, continuous) income of the individual, which makes him human capital as a component of property.

In the domestic economic literatu re a long time instead of the term "human capital" used the concept of "Education Fund", which is a valuation of accrued staff knowledge, skills, abilities and experience.

In assessing the Education Fund are two basic approaches:

1. counted the actual cost of education undertaken within a given long period of time. During this period, the time separating education from the time of counting, consistently increasing level of education itself, but also increases the cost of training. Given the appropriate adjustments age labor turnover and mortality can build a series of indicators Education Fund, representing a cumulative total of all previous cost less money spent on training people who are already retired at the time of calculation of the labor force population.

2. P roizvoditsya assessment of the real productive value of the stock of knowledge, skills, abilities, experience, which has the labor force in a certain period of time.

For today's companies can offer a number of fundamental approaches to assess their human capital.

Methods for calculating the value of human capital:

1. The method of calculation of direct personnel costs. The easiest way for managers to calculate the overall economic costs incurred by the company for its staff, including the assessment of the cost of paying staff associated with these taxes, protection and improvement of working conditions, the cost of training and professional development. The advantage of this method - simplicity. Disadvantages - incomplete assessment of the real value of human capital. Part of it may simply not be used in the enterprise.

2. The method of item oimosti competitive assessment of human capital . This method is based on the sum of the costs and potential damage to the company, with the possible departure from her employee:

-   total staff costs produced leading competitor (subject to comparable production capacity);

-   individual premiums for each employee of the company (obtained on the basis of qualified expert assessments) that could rival company to pay for his passage to them;

-   additional costs the company needed to find an equivalent replacement worker in the event of transfer to another company, the cost of an independent search, recruitment agencies, ads in the press;

-   economic loss incurred by the company for a period of search-replace, reducing the volume of products or services, the cost of training a new employee, the deterioration of the quality of products when replacing a new employee;

-   loss of unique intellectual products, skills and capabilities that the employee will carry with them into the company of a competitor;

-   the possibility of losing part of the market, competitor sales growth and increased its influence on the market;

-   change system synergy effects and the emergence of (gain mutual influence and the emergence of qualitatively new properties) members of the group in which there was an employee.

3. The method of prospective value of human capi tal.

Take into account, in addition to the method of assessment of the dynamics of competitive cost value of human capital in the long term for 3 , 5 , 10 and 25 years. This assessment in the first place, it is necessary for companies involved in the development of large and long-term projects, such as conducting research in the field of innovation or constructing large high-tech facilities, as the cost of a number of staff changes at the same uneven rise sharply in the period to achieve their most important results after a sufficiently long period of time and bringing them to obtain the expected outcomes when possible departure from the company of the staff coupled with high economic losses.

4.   About tsenka human capital based on the teachings of Business in management, economics and marketing on the basis of high-tech information. This concept is based on the forecast performance manager in the business environment, as close to its real environment. As the complexity of market conditions entrepreneurs quickly realized that every dollar invested in training management, gives the highest return in the economy. In order to attract managers, providing a breakthrough in the market and the company's transition from zone to zone loss of profits, companies are willing to spend the amount measured in tens of millions of dollars. Not surprisingly, the most paid jobs in the labor market conditions is the manager, the skill and talent of which depends the prosperity or ruin the market.

If you look at the countries of the world, it is estimated that the largest amount of human capital is in the US and is about three quadruple the total wealth USA. Investments in human capital have become the main cause of strong economic development of the United States in the late twentieth century ekah. 

 

 

 

 

Chapter 2. And HBE ments in human capital

2.1 Investment in human capital and their types 

 

Investment in human capital is any measure taken to improve productivity. Thus, by investing in human capital include the costs of maintaining health, for general and special education; costs associated with job search, training in the workplace, migration, birth and upbringing of children, finding economically significant information on prices and wages.

Economists identify three types of investment in human capital:

-   spending on education, including general and specialized, formal and informal, training in the workplace;

-   health expenditure is the sum of the costs of disease prevention, health care, diet, improving housing conditions;

-   costs of mobility, so that employees migrates from a relatively low capacity.

There is also a division of investment in human capital in the material and immaterial. The first group includes all the costs necessary for the formation of physical and human development (costs birth and upbringing of children); to the second - the accumulated costs of general education and special training of the cumulative costs of health care and the labor movement.

Of all the types of investment in human capital are the most important investments in health and education. General and special education to improve quality, expand and improve the stock of human knowledge, thereby increasing the quantity and quality of human capital. Investment in higher education also contribute to the formation of highly qualified professionals, highly skilled labor which has the greatest impact on economic growth.

Today one of the most important components of investment in human capital in all countries are the costs of training in the workplace. In any educational project to 8 0% knowledge accounted for independent learning. This particularly applies to trades professionals - researchers, teachers, engineers, computer experts, etc. That are designed to continually update skills through individual study of literature, the use of independent training programs, training for an example of activity, experience and evaluations (opinions) of others.