Question

Discuss the following as a source of human capital formation health infrastructure and expenditure on migration

Answer 1

Health Infrastructure. Health is another important source of human capital formation. Preventive medicine (vaccination), curative medicine (medical intervention during illness), social medicine (spread of health literacy) and provision of clean drinking water and good sanitation are the various forms of health expenditure. Health expenditure directly increases the supply of healthy labour force and is, thus, a source of human capital formation.
Migration. People sometimes migrate from one place to the other in search of better job. It includes
migration of people from rural areas to urban areas in India and migration of technical personnel from India to other countries of the world.

Migration in both these cases involves cost of transport, higher cost of living in the migrated places and psychic costs of living in a strange socio-cultural set-up. The enhanced earnings in the new place outweigh the costs of migration. Expenditure on migration is also a source of capital formation.