Licchavi Lyceum


Licchavi Lyceum

Human Capital Formation in India NCERT Solutions for Class 11 Indian Economic Development

1 What are the two major sources of human capital in a country?

A: The two major sources of human capital in a country are education and healthcare.

2. What are the indicators of educational achievement in a country?

A: Indicators of educational achievement in a country include literacy rates, enrollment and attendance rates at different educational levels, completion rates, standardized test scores, and educational attainment levels among the population.

3. Why do we observe regional differences in educational attainment in India?

A: Regional differences in educational attainment in India can be attributed to factors such as varying socio-economic conditions, accessibility of educational facilities, cultural differences, disparities in infrastructure, and historical factors. Government policies and initiatives also impact educational opportunities differently across regions.

4. Bring out the differences between human capital and human development.


  • Human Capital: Human capital refers to the knowledge, skills, and abilities possessed by individuals that contribute to their productivity and economic output. It focuses on the economic aspects of human potential and emphasizes factors like education, training, and health.
  • Human Development: Human development is a broader concept encompassing not only economic factors but also social, political, and cultural dimensions. It considers factors like life expectancy, quality of life, gender equality, and overall well-being. Human development looks beyond economic indicators and aims for holistic improvement in human lives.

5. How is human development a broader term as compared to human capital?

A: Human development is a broader term compared to human capital because it encompasses not only economic factors but also social, political, and cultural dimensions. While human capital focuses on the economic value of skills and knowledge, human development looks at the overall well-being of individuals, considering aspects such as life expectancy, quality of life, gender equality, and access to education and healthcare. Human development aims for holistic improvement in human lives beyond their economic productivity.

6. What factors contribute to human capital formation?

A: Several factors contribute to human capital formation, including:

  • Education: Access to quality education and skill development programs.
  • Healthcare: Adequate healthcare facilities and nutrition for a healthy population.
  • Training and Skill Development: Programs that enhance specific skills and capabilities.
  • Gender Equality: Ensuring equal opportunities for men and women in education and employment.
  • Social Infrastructure: Access to basic amenities like clean water, sanitation, and housing.
  • Economic Opportunities: Availability of employment and income-generating activities.
  • Government Policies: Initiatives that promote education, healthcare, and skill development.

These factors collectively contribute to the formation and enhancement of human capital in a society.

7. Mention two government organizations each that regulate the health and education sectors.


  • Health Sector:
    1. Ministry of Health and Family Welfare (MoHFW): The central government body responsible for formulating and implementing health policies and programs in India.
    2. Medical Council of India (MCI): Regulates and sets standards for medical education and practice.
  • Education Sector:
    1. Ministry of Education (MoE): Formulates and implements policies related to education in India.
    2. University Grants Commission (UGC): Regulates and maintains the standards of higher education in the country.

8. Education is considered an important input for the development of a nation. How?

A: Education is a crucial input for the development of a nation for several reasons:

  • Economic Growth: Education equips individuals with skills and knowledge, enhancing their productivity and contributing to economic growth. A skilled and educated workforce attracts investments and drives innovation.
  • Human Capital Formation: Education is the primary driver of human capital formation. It develops individuals’ capacities, making them valuable assets for the workforce, thereby fostering overall human development.
  • Reduced Poverty: Education provides individuals with better job opportunities, reducing poverty. A skilled workforce can participate in higher-paying jobs, leading to improved living standards.
  • Social Cohesion: Education promotes social cohesion by instilling values, ethics, and a sense of responsibility. It contributes to the creation of an informed and engaged citizenry, essential for a well-functioning democracy.
  • Technological Advancement: An educated population is more likely to contribute to technological advancements and innovation. Education is a key factor in driving research and development.
  • Health Improvement: Education is linked to better health outcomes. An educated population is more likely to adopt healthier lifestyles, access healthcare, and contribute to improved public health.
  • Cultural Preservation: Education plays a role in preserving and transmitting cultural heritage. It helps in the preservation of cultural identity and traditions.

In summary, education is a foundational element for national development, influencing economic prosperity, social well-being, and overall progress.

9. Discuss the following as sources of human capital formation:

(i) Health Infrastructure: Health infrastructure is a significant source of human capital formation as it directly impacts the health and well-being of individuals. Key points include:

  • Access to Healthcare Services: Adequate health infrastructure, including hospitals, clinics, and healthcare professionals, ensures access to medical services.
  • Preventive Healthcare: Health infrastructure supports preventive measures, reducing the incidence of diseases and promoting a healthy population.
  • Nutrition and Sanitation: Facilities that promote proper nutrition and sanitation contribute to the overall health of individuals.
  • Reduced Morbidity: Improved health infrastructure leads to reduced morbidity rates, enhancing the productivity and quality of life of individuals.

(ii) Expenditure on Migration: Expenditure on migration, such as investing in skills development and supporting migration for employment opportunities, can contribute to human capital formation:

  • Skill Enhancement: Migration often involves acquiring new skills or enhancing existing ones, contributing to the formation of human capital.
  • Income Generation: Migration for employment can lead to increased income, allowing individuals to invest in education and health, thereby enhancing their overall human capital.
  • Diversity and Cultural Exchange: Migration can bring cultural diversity, fostering a broader perspective and understanding among individuals.

10. Establish the need for acquiring information relating to health and education expenditure for the effective utilization of human resources.

Acquiring information on health and education expenditure is crucial for effective human resource utilization for several reasons:

  • Resource Allocation: Information on expenditure helps policymakers allocate resources effectively, ensuring that adequate funds are allocated to health and education sectors, which are critical for human capital development.
  • Policy Planning: Detailed expenditure data aids in the formulation of targeted policies and interventions to address specific challenges in healthcare and education, leading to improved outcomes.
  • Monitoring and Evaluation: Regular information on expenditure allows for monitoring the effectiveness of implemented policies, identifying areas of improvement, and evaluating the impact of interventions on human capital development.
  • Identification of Gaps: By analyzing expenditure patterns, policymakers can identify gaps in the healthcare and education systems, allowing for strategic interventions to bridge these gaps and improve overall resource utilization.
  • Outcome Measurement: Information on expenditure assists in measuring the outcomes of health and education programs, facilitating evidence-based decision-making for further policy refinement.

In summary, acquiring information on health and education expenditure is essential for informed decision-making, efficient resource allocation, and the formulation of effective policies to enhance human capital formation and utilization.

11. How does investment in human capital contribute to growth?

Investment in human capital contributes to economic growth in several ways:

  • Productivity Improvement: Education and training enhance the skills and productivity of the workforce, leading to increased output and efficiency.
  • Innovation and Technological Advancement: Educated individuals are more likely to contribute to innovation and technological progress, fostering economic growth.
  • Healthier Workforce: Investments in health and education result in a healthier workforce, reducing absenteeism and increasing overall productivity.
  • Economic Diversification: A skilled and educated population is better equipped to participate in diverse economic activities, promoting economic diversification.
  • Entrepreneurship: Education fosters an entrepreneurial spirit, leading to the creation of new businesses and job opportunities, further stimulating economic growth.

12. ‘There is a downward trend in inequality worldwide with a rise in the average education levels’. Comment.

Comment: The statement suggests a correlation between a decrease in global inequality and an increase in average education levels. This trend can be attributed to several factors:

  • Skill-Based Income Disparities: Higher education levels often lead to the acquisition of specialized skills, reducing income disparities and contributing to a more equitable distribution of wealth.
  • Access to Opportunities: Improved education levels provide individuals with better access to economic opportunities, reducing the gap between the privileged and underprivileged.
  • Social Mobility: Education is a key driver of social mobility, allowing individuals from diverse backgrounds to climb the economic ladder, contributing to a more equitable society.
  • Policy Interventions: Governments and international bodies often implement policies focused on increasing education levels as a strategy to address economic disparities.

While the correlation between education and reduced inequality is observed globally, it’s essential to consider other socio-economic factors that may influence this relationship.

13. Examine the role of education in the economic development of a nation.

Education plays a crucial role in the economic development of a nation through various mechanisms:

  • Human Capital Formation: Education enhances the skills and knowledge of individuals, contributing to the formation of human capital, which is a key driver of economic growth.
  • Productivity Improvement: An educated workforce is more productive, leading to increased output and efficiency in various economic sectors.
  • Innovation and Technological Progress: Education fosters innovation and the adoption of new technologies, driving economic advancements and competitiveness.
  • Entrepreneurship: Education nurtures an entrepreneurial spirit, leading to the creation of new businesses, job opportunities, and economic diversification.
  • Poverty Reduction: Education is instrumental in reducing poverty by providing individuals with the skills needed for better employment prospects and income generation.
  • Social and Economic Mobility: Education allows for social and economic mobility, breaking the cycle of poverty and promoting a more inclusive and equitable society.

In summary, education is a fundamental pillar for the economic development of a nation, influencing various aspects that contribute to sustained and inclusive growth.

14. How does investment in education stimulate economic growth?

Investment in education is a catalyst for economic growth through various mechanisms:

a. Human Capital Development: How does education contribute to the development of human capital, enhancing workforce skills, knowledge, and productivity?

b. Increased Productivity: In what ways does education lead to improved individual and overall productivity within the economy?

c. Innovation and Technological Advancement: How does education foster a culture of innovation and creativity, contributing to technological progress and economic development?

d. Entrepreneurship: In what manner does education empower individuals to become entrepreneurs, promoting the creation of new businesses and industries?

e. Social and Economic Mobility: How does access to education provide opportunities for social and economic mobility, contributing to a more dynamic and inclusive economy?

f. Reduced Inequality: In what ways does education help reduce income inequality, creating a more equitable society associated with stronger economic growth?

15. What is the need for on-the-job training for an individual?

On-the-job training is essential for several reasons:

a. Skill Development: How does on-the-job training facilitate the acquisition of specific skills directly applicable to an individual’s job role?

b. Adaptation to Workplace Environment: In what ways does practical on-the-job training help individuals adapt to the specific challenges and dynamics of their workplace?

c. Increased Productivity: How does on-the-job training contribute to increased productivity by reducing the learning curve and enabling effective performance in actual job settings?

d. Employee Satisfaction: How does providing on-the-job training contribute to higher job satisfaction, increased morale, and a sense of loyalty among employees?

e. Cost-Effective Learning: How is on-the-job training more cost-effective than external training programs, as it is tailored to the specific needs of the organization?

16. How is the relationship between human capital and economic growth traced?

The relationship between human capital and economic growth is intricate and interconnected:

a. Productivity and Innovation: How does human capital act as a key driver of productivity, fostering innovation and contributing to increased output per worker?

b. Labor Market Efficiency: In what ways does a highly educated and skilled workforce enhance the efficiency of the labor market, reducing unemployment and ensuring a better match between skills and job requirements?

c. Technological Advancement: How does human capital, with its educated and skilled individuals, contribute to technological progress, enhancing efficiency and global competitiveness?

d. Economic Diversification: How does human capital diversify the economy by enabling individuals to engage in various occupations, creating resilience to external shocks and fostering economic growth?

e. Long-term Economic Stability: How do investments in human capital contribute to long-term economic stability by creating a knowledgeable, adaptable, and innovative workforce?

17. Why is promoting women’s education crucial in India?

a. Gender Equality: How does women’s education contribute to the overall goal of achieving gender equality in India?

b. Economic Empowerment: In what ways does education empower women economically, leading to increased financial independence and opportunities?

c. Health and Family Well-being: How does women’s education positively impact family health and well-being, including maternal and child health?

d. Reducing Population Growth: How can women’s education play a role in controlling population growth through better awareness and family planning?

e. Social Development: What role does women’s education play in fostering social development, breaking traditional stereotypes, and promoting inclusivity?

f. Political Participation: How does education empower women to participate actively in political processes, contributing to a more representative and inclusive democracy?

18. Why is there a need for different forms of government intervention in education and health sectors?

a. Ensuring Access and Equity: How does government intervention help ensure that education and healthcare services are accessible to all, reducing disparities?

b. Quality Assurance: In what ways can government intervention improve the quality of education and healthcare services, setting and enforcing standards?

c. Addressing Market Failures: How does government intervention rectify market failures in the education and health sectors, ensuring that public goods are provided efficiently?

d. Social Justice: How can government intervention in education and health address social justice issues, ensuring that marginalized groups receive adequate services and opportunities?

e. Economic Productivity: How does investing in education and health through government intervention contribute to overall economic productivity and development?

f. Crisis Response: How does government intervention become crucial during crises, such as pandemics or natural disasters, to ensure the continuity of essential services in education and health?

19. What are the main problems of human capital formation in India?

a. Access to Education: What challenges does India face in ensuring universal access to education, particularly in rural and marginalized areas?

b. Quality of Education: How does the quality of education impact human capital formation, and what are the challenges in maintaining high educational standards?

c. Skill Mismatch: In what ways does the gap between education and industry requirements contribute to a mismatch of skills in the labor market?

d. Gender Disparities: How do gender disparities in education hinder effective human capital formation, and what measures can address this issue?

e. Inadequate Healthcare: How does the lack of access to quality healthcare impact the overall health and productivity of the population?

f. Underemployment and Unemployment: What challenges does India face in providing opportunities for employment that align with the skills and education of its workforce?

20. In your view, is it essential for the government to regulate the fee structure in education and health care institutions? If so, why?

a. Ensuring Accessibility: How does government regulation of fee structures contribute to making education and healthcare services accessible to a broader section of the population?

b. Preventing Exploitation: In what ways does fee regulation prevent private institutions from exploiting students and patients by charging exorbitant fees?

c. Promoting Social Justice: How does fee regulation align with the principles of social justice, ensuring that individuals from diverse economic backgrounds have equal access to essential services?

d. Maintaining Quality: Can government regulation balance the need for affordability with the requirement to maintain the quality of education and healthcare services?

e. Mitigating Economic Disparities: How does fee regulation play a role in mitigating economic disparities by preventing the exclusion of certain groups from quality education and healthcare?

f. Stability and Predictability: How does fee regulation contribute to the stability and predictability of costs for individuals and families, enabling better financial planning for education and healthcare expenses?