Question

7. Why is investment in human capital so important to long-run economic growth?

Answer 1

Since human capital means educated and skilled labour force.

Economic growth means production of more goods and services.

Since production of more goods and services is possible through with advanced technology, human capital and an increase in the resources.

So by investing in human capital, more human capital will increase. With the more human capital, the production of goods and services will increase. Hence in the long run the economic growth will take place due to more investment in human capital.